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

    EBA Updates List of Validation Rules for Reporting by Banks

    EBA issued a revised list of validation rules with respect to the implementing technical standards on supervisory reporting.

    September 10, 2020 WebPage Regulatory News
    News

    EBA Responds to EC Call for Advice to Strengthen AML/CFT Framework

    EBA published its response to the call for advice of EC on ways to strengthen the EU legal framework on anti-money laundering and countering the financing of terrorism (AML/CFT).

    September 10, 2020 WebPage Regulatory News
    News

    NGFS Advocates Environmental Risk Analysis for Financial Sector

    NGFS published a paper on the overview of environmental risk analysis by financial institutions and an occasional paper on the case studies on environmental risk analysis methodologies.

    September 10, 2020 WebPage Regulatory News
    News

    MAS Issues Guidelines to Promote Senior Management Accountability

    MAS published the guidelines on individual accountability and conduct at financial institutions.

    September 10, 2020 WebPage Regulatory News
    News

    APRA Formalizes Capital Treatment and Reporting of COVID-19 Loans

    APRA published final versions of the prudential standard APS 220 on credit quality and the reporting standard ARS 923.2 on repayment deferrals.

    September 09, 2020 WebPage Regulatory News
    News

    SRB Chair Discusses Path to Harmonized Liquidation Regime for Banks

    SRB published two articles, with one article discussing the framework in place to safeguard financial stability amid crisis and the other article outlining the path to a harmonized and predictable liquidation regime.

    September 09, 2020 WebPage Regulatory News
    News

    FSB Workshop Discusses Preliminary Findings of Too-Big-To-Fail Reforms

    FSB hosted a virtual workshop as part of the consultation process for its evaluation of the too-big-to-fail reforms.

    September 09, 2020 WebPage Regulatory News
    News

    ECB Updates List of Supervised Entities in EU in September 2020

    ECB updated the list of supervised entities in EU, with the number of significant supervised entities being 115.

    September 08, 2020 WebPage Regulatory News
    News

    OSFI Identifies Focus Areas to Strengthen Third-Party Risk Management

    OSFI published the key findings of a study on third-party risk management.

    September 08, 2020 WebPage Regulatory News
    News

    FSB Extends Implementation Timeline for Framework on SFTs

    FSB is extending the implementation timeline, by one year, for the minimum haircut standards for non-centrally cleared securities financing transactions or SFTs.

    September 07, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5796