MFSA published a Circular for credit institutions on the issuance of a new Banking Rule BR/23 on reporting and disclosure of exposures subject to measures applied in response to the COVID-19 crisis. The new Banking Rule BR/23 will come into force with immediate effect. This recent communication clarifies expectations for both significant and less significant institutions. MFSA also published the reporting templates and instructions for COVID-19 data.
The rule intends to implement the provisions and requirements introduced by EBA guidelines on reporting and disclosure of exposures subject to measures applied in response to the COVID-19 crisis (EBA/GL/2020/07). Through such implementation, the rule introduces additional reporting and disclosure requirements for credit institutions with respect to mitigating measures introduced in Malta to combat the negative economic consequences of the COVID-19 pandemic. Pursuant to such measures, credit institutions are obliged to report information, in accordance with the formats specified in the rule, on:
- Exposures that are subject to payment moratoria in accordance with the Moratorium on Credit Facilities in Exceptional Circumstances Regulations, 2020 (L.N. 142 of 2020) and the Central Bank of Malta (CBM) Directive No. 18 on Moratoria on Credit Facilities in Exceptional Circumstances
- Exposures that are subject to other forbearance measures introduced in response to the COVID-19 crisis
- Newly originated exposures subject to the Malta Development Bank COVID-19 Guarantee Scheme
Annex 1 to the rule provides credit institutions with the reporting templates, which are to be populated for submission to MFSA, together with further information on the reporting requirements laid down in the rule, including submission guidance. Annex 2 to the rule provides credit institutions with the reporting instructions to be followed with regard to the reporting templates in Annex 1. Finally, Annex 3 to the rule provides the disclosure templates that credit institutions are required to use for the publication of such information. Credit institutions shall report such data on a monthly basis and in line with the specified reference and remittance periods: reference reporting on the last day of each month and remittance reporting 42 calendar days following each above-specified reporting reference date. For significant institutions, the first reference and remittance dates are as per the Joint Supervisory Team communication. For the less significant institutions and significant subsidiaries, first reference date is June 30, 2020 and the first remittance date is August 11, 2020
Information on exposures subject to the Moratorium on Credit Facilities in Exceptional Circumstances Regulations and the CBM Directive No. 18. and on newly originated exposures subject to the MDB COVID-19 Guarantee Scheme shall be disclosed by credit institutions bi-annually. MFSA may consider the exercise of the waivers laid down in paragraph 21 of the rule to ensure proportional application of the newly introduced reporting and disclosure requirements.
Keywords: Europe, Malta, Banking, Reporting, Disclosures, COVID-19, Basel, Credit Risk, MFSA
PRA published the policy statement PS8/21, which contains the final supervisory statement SS3/21 on the PRA approach to supervision of the new and growing non-systemic banks in UK.
EBA published a report that sets out the final draft regulatory technical standards specifying the conditions according to which consolidation shall be carried out in line with Article 18 of the Capital Requirements Regulation (CRR).
EBA updated the list of other systemically important institutions (O-SIIs) in EU.
BCBS published two reports that discuss transmission channels of climate-related risks to the banking system and the measurement methodologies of climate-related financial risks.
UK Authorities (FCA and PRA) welcomed the findings of FSB peer review on the implementation of financial sector remuneration reforms in the UK.
PRA and FCA jointly issued a letter that highlights risks associated with the increasing volumes of deposits that are placed with banks and building societies via deposit aggregators and how to mitigate these risks.
MFSA announced that amendments to the Banking Act, Subsidiary Legislation, and Banking Rules will be issued in the coming months, to transpose the Capital Requirements Directive (CRD5) into the national regulatory framework.
EC finalized the Delegated Regulation 2021/598 that supplements the Capital Requirements Regulation (CRR or 575/2013) and lays out the regulatory technical standards for assigning risk-weights to specialized lending exposures.
OSFI launched a consultation to explore ways to enhance the OSFI assurance over capital, leverage, and liquidity returns for banks and insurers, given the increasing complexity arising from the evolving regulatory reporting framework due to IFRS 17 (Insurance Contracts) standard and Basel III reforms.
ECB published results of the benchmarking analysis of the recovery plan cycle for 2019.