Featured Product

    EBA Assesses Application of Regulatory Standards on Identified Staff

    January 16, 2020

    EBA published its report on the application of the regulatory technical standards on criteria to identify categories of staff whose professional activities have a material impact on the risk profile of an institution. This peer review aims to assess the supervisory practices followed and measures taken by competent authorities with respect to the requirements of the technical standards. The results of the review show that, within the European Economic Area, the competent authorities have properly applied the technical standards during the reference period from January 01, 2015 to December 31, 2017.

    To gain a deep understanding of the identification process, which begins with practices within the institutions, the review panel selected a small number of institutions forming a representative sample, including one significant institution for each member state and two less significant institutions. These institutions were requested to provide data on the numbers of staff members identified under the qualitative and quantitative criteria set out in the technical standards and through the application of additional internal criteria. This assessment was intended to enable EBA and the review panel to flag any issues that institutions face in the application of the EBA requirements, along with any possible interpretation issues or loopholes resulting from the current text of the technical standards. This report highlights the following observed best practices:

    • Competent authorities collect information from institutions to ensure that the required information is all included in the documentation.
    • Institutions have a notification and prior approval process regarding exemptions for identified staff under Article 4(4) and (5) of the technical standards.
    • The application of exemptions for individual staff is assessed under Article 4(2) to (4) of the technical standards.
    • The use of supervisory tools for assessing the compliance of institutions.

    Additionally, the review panel identified certain weaknesses in the application of some parts of the technical standards. Competent authorities typically follow a risk-based approach, though some of them have some difficulties to distinguish their standard risk-based methods of supervision and the application of the proportionality principle. This leads to diverging approaches and, in a few cases, to the exclusion of certain institutions from the supervisory review on a systematic basis. The review panel suggested conducting a targeted review of the application of the technical standards after their amendment, following the entry into force of the Capital Requirements Directive or CRD5 (2019/879/EU). However, time should be allowed before this review takes place, as both supervisors and institutions will need time to implement CRD5 and the amended technical standards on identified staff. The review will aim to ensure that the competent authorities have addressed the observed weaknesses in a consistent manner.


    Related Links

    Keywords: Europe, EU, Banking, Operational Risk, Peer Review, Competent Authorities, Regulatory Technical Standards, Remuneration, CRD5, EBA

    Related Articles

    US Agencies Issue Regulatory Updates, FDIC Launches Tech Sprint

    The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.

    January 13, 2022 WebPage Regulatory News

    EBA Issues Guide on Bank Resolvability, Consults on Transferability

    The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).

    January 13, 2022 WebPage Regulatory News

    HKMA Extends Repayment for Trade Facilities, Consults on Crypto-Assets

    The Hong Kong Monetary Authority (HKMA) published a circular, along with the reporting form and instructions, for self-assessment, by authorized institutions, of compliance with the Code of Banking Practice 2021.

    January 12, 2022 WebPage Regulatory News

    FCA Registers Securitization Repositories; PRA Issues 2022 Priorities

    The Financial Conduct Authority (FCA) decided to register European DataWarehouse Ltd and SecRep Limited as securitization repositories under the UK Securitization Regulation, with effect from January 17, 2022.

    January 12, 2022 WebPage Regulatory News

    EC Regulation Sets Out Methods for Measuring K-Factors Under IFR

    The European Commission (EC) published the Delegated Regulation 2022/25, which supplements the Investment Firms Regulation (IFR or Regulation 2019/2033) with respect to the regulatory technical standards specifying the methods for measuring the K-factors referred to in Article 15 of the IFR.

    January 11, 2022 WebPage Regulatory News

    BIS Studies How Platform Models Impact Financial Stability & Inclusion

    The Bank of International Settlements (BIS) published a paper that assesses the ways in which platform-based business models can affect financial inclusion, competition, financial stability and consumer protection.

    January 10, 2022 WebPage Regulatory News

    ESAs Publish List of Financial Conglomerates for 2021

    The European Supervisory Authorities (ESAs) published the list of identified financial conglomerates for 2021.

    January 07, 2022 WebPage Regulatory News

    APRA Licenses Two More Banks, Reduces Committed Liquidity Facility

    The Australian Prudential Regulation Authority (APRA) updated the list of authorized deposit-taking institutions, granting license to Barclays Bank PLC and Crédit Agricole Corporate and Investment Bank to operate as foreign authorized deposit-taking institutions under the Banking Act 1959.

    January 07, 2022 WebPage Regulatory News

    EU Issues SII Corrigendum; EIOPA Assesses SII Reporting Exemptions

    EU published, in the Official Journal of the European Union, a corrigendum to the Delegated Regulation 2015/35, which supplements Solvency II Directive (2009/138/EC).

    January 06, 2022 WebPage Regulatory News

    EBA Opines on Impact of De-Risking and Associated AML/CFT Challenges

    The European Banking Authority (EBA) published an Opinion on the scale and impact of de-risking in European Union and the steps that competent authorities should take to tackle unwarranted de-risking.

    January 05, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 7860