BaFin Issues Regulatory Updates for Banks in Germany
The Federal Financial Supervisory Authority of Germany (BaFin) published a circular on determination of the minimum requirement for own funds and eligible liabilities (MREL) for institutions and group companies, for which the wind-up plan provides for liquidation in the context of insolvency proceedings. This circular will replace the previous MREL circular that was published in August 2019. BaFin also launched a consultation (12/2021) on revisions to the circular on the minimum requirements for feasibility of a bail-in (MaBail-in). BaFin is consulting to extend the circular to institutions and group-affiliated companies for which the resolution plan does not provide for any resolution measures, provided they are part of a resolution group or relevant third-country subsidiaries. The consultation closes on August 18, 2021.
In addition, BaFin published amendments to the minimum requirements for risk management (MaRisk). The amendments to the minimum requirements for risk management implement the European Banking Authority (EBA) guidelines on management of non-performing and forborne exposures (EBA/GL/2018/06), outsourcing (EBA/GL/2019/02), and information and communication technology (ICT) and security risk management (EBA/GL/2019/04). A new version of the banking supervisory requirements for information technology (BAIT) was also released. In the amended BAIT, the supervisory authority describes what framework conditions they can now expect for secure information processing and information technology. Finally, BaFin published the payment service supervisory requirements for information technology (ZAIT), for payment and e-money institutions.
Related Links (in German)
- Press Release on MREL Circular
- MREL Circular
- Press Release on MaBail-In
- Consultation on MaBail-In
- Press Release on MaRisk, BAIT, and ZAIT
- Circular on MaRisk
- Circulars on BAIT
- Circular on ZAIT
Comment Due Date: August 18, 2021
Keywords: Europe, Germany, Banking, MREL, Bail-In, ICT Risk, Resolution Framework, Outsourcing, Technology Risk, NPLs, Forborne Exposures, EBA, BaFin
Previous Article
OSFI Proposes Revisions to Guideline on Model Risk ManagementRelated Articles
EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models
The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.
EP Reaches Agreement on Corporate Sustainability Reporting Directive
The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).
PRA Consults on Model Risk Management Principles for Banks
The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.
EC Regulation Amends Standards for Calculating Credit Risk Adjustments
The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.
BIS Hub Updates Work Program for 2022, Announces New Projects
The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.
EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance
The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.
US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule
Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)
EIOPA Consults on Review of Securitization Framework in Solvency II
The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.
UK Authorities Issue Regulatory and Reporting Updates for Banks
The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.
BCBS Issues Climate Risk Principles while HKMA Expresses Its Support
The Basel Committee on Banking Supervision (BCBS) issued principles for the effective management and supervision of climate-related financial risks.