Featured Product

    ECB to Conduct Comprehensive Assessment of Five Croatian Banks

    August 07, 2019

    ECB announced that it will comprehensively assess financial soundness of five Croatian banks: Zagrebačka banka, Privredna banka Zagreb, Erste & Steiermärkische Bank, OTP banka Hrvatska, and Hrvatska poštanska banka. The exercise will comprise an asset quality review (AQR) and a stress test. This assessment is the result of submission of a request by Croatia in May 2019, under which Croatia seeks to establish close cooperation between ECB and Hrvatska narodna banka. The exercise is expected to start in September 2019, with the results due to be finalized in May 2020. ECB also published the frequently asked questions about the request of Croatia to establish close cooperation with ECB.

    Banks will be assessed on the basis of data as at June 30, 2019. A comprehensive assessment is required as part of the process of establishing close cooperation between ECB and the national competent authority of an EU member state whose currency is not the euro. The general objectives of every comprehensive assessment conducted by ECB are to assess whether banks are fundamentally sound, enhance the quality of information available on the condition of banks, and identify problems and implement the necessary corrective actions. The AQR and the stress test will be based on the methodologies applied by ECB Banking Supervision in its regular comprehensive assessments of credit institutions that have recently been classified as significant or could potentially become significant. The AQR will be performed using the updated AQR methodology, which ECB had published in June 2018 and which considers the impact of IFRS 9. 

    The five banks have been chosen to ensure a level of coverage that is consistent with Article 6(4) of the Single Supervisory Mechanism (SSM) Regulation and is broadly comparable with the previous comprehensive assessments conducted by ECB since 2014. Institutions are selected on the basis of their size, risk profile, and overall significance for the national economy and this involves taking account of several elements such as the business model of the institution, its internal governance and risk management, its capital risk, its liquidity and funding risk, and its interconnectedness with the rest of the financial system. ECB will also assess the relevant Croatian legislation, ensuring that Hrvatska narodna banka will be obliged to adopt all measures requested by ECB in relation to Croatian credit institutions. ECB Banking Supervision is working closely with Hrvatska narodna banka in view of its potential future role as a national competent authority within SSM. The steps that are being taken in this regard are in line with the process that was recently followed for Bulgaria.

     

    Related Links

    Keywords: Europe, EU, Croatia, Banking, Comprehensive Assessment, Asset Quality Review, Stress Testing, IFRS 9, Hrvatsa Narodna Banka, SSM, ECB

    Featured Experts
    Related Articles
    News

    EU Amends CRD4 and CRD5 as Part of Capital Markets Recovery Package

    EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis.

    February 26, 2021 WebPage Regulatory News
    News

    EU Committee Recommends Systemic Risk Buffer of 4.5% in Norway

    The Standing Committee of the European Free Trade Association (EFTA) recommended that a systemic risk buffer level of 4.5% for domestic exposures can be considered appropriate for addressing the identified systemic risks to the stability of the financial system in Norway.

    February 25, 2021 WebPage Regulatory News
    News

    PRA Clarifies Approach to Onshoring of Credit Risk Rules for UK Banks

    In a recent statement, PRA clarified its approach to the application of certain EU regulatory technical standards and EBA guidelines on standardized and internal ratings-based approaches to credit risk, following the end of the Brexit transition.

    February 25, 2021 WebPage Regulatory News
    News

    FSB Sets Out Work Priorities for 2021

    In a recently published letter addressed to the G20 finance ministers and central bank governors, the FSB Chair Randal K. Quarles has set out the key FSB priorities for 2021.

    February 25, 2021 WebPage Regulatory News
    News

    EU Publishes Corrigendum to Revised Capital Requirements Regulation

    EU published, in the Official Journal of the European Union, a corrigendum to the revised Capital Requirements Regulation (CRR2 or Regulation 2019/876).

    February 25, 2021 WebPage Regulatory News
    News

    ESAs Issue Statement on Application of Sustainability Disclosures Rule

    ESAs published a joint supervisory statement on the effective and consistent application and on national supervision of the regulation on sustainability-related disclosures in the financial services sector (SFDR).

    February 25, 2021 WebPage Regulatory News
    News

    EC Consults on Crisis Management and Deposit Insurance Frameworks

    EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU.

    February 25, 2021 WebPage Regulatory News
    News

    HKMA Enhances Loan Guarantee Scheme to Alleviate Pressure on SMEs

    HKMA announced that enhancements will be made to the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme (SFGS) and the application period will be extended to December 31, 2021.

    February 24, 2021 WebPage Regulatory News
    News

    EBA Proposes Standards for Supervisory Cooperation Under IFD

    EBA launched consultations on the regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in prudential supervision of investment firms.

    February 24, 2021 WebPage Regulatory News
    News

    BoE Addresses Banks in Scope of First Resolvability Assessment

    BoE issued a letter to the CEOs of eight major UK banks that are in scope of the first Resolvability Assessment Framework (RAF) reporting and disclosure cycle.

    February 24, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 6629