ESAs informed EC, via a letter, that the draft regulatory technical standards that amend the technical rules on key information document (KID) for packaged retail and insurance-based investment products (PRIIPs) were not adopted by all three ESA Boards. Therefore, ESAs are not in a position to formally submit the technical standards to EC. The letter details the outcome of a review conducted by ESAs on KID for PRIIPs. The review intended to address the regulatory issues that have been identified since the implementation of the KID—particularly regarding the information on performance and costs—and to allow the appropriate application of the KID by undertakings for collective investment in transferable securities (UCITS).
As part of this review, a draft final report had been submitted to the Boards of Supervisors of the three ESAs in June, for their approval. The report contained balanced and proportionate final proposals that would allow ESAs to meet their key policy objectives, while remaining in line with the PRIIPs level 1 framework (Regulation 1286/2014). The draft technical standards were adopted at the EBA and ESMA Boards on the basis of qualified majority voting. At the EIOPA Board, the standards did not receive the support of a qualified majority, although a large number of members agreed with the draft technical standards. The EIOPA Board members that did not support the technical standards generally argued that a partial revision of the PRIIPs Regulation is not appropriate at this stage, prior to a comprehensive review of Regulation 1286/2014 as envisaged in Article 33 of the Regulation. A number of Board members also indicated that, for investment funds, they would prefer the past performance graph from the UCITS key investor information document to be included in the PRIIPs KID, rather than in a separate publication. Given that the draft technical standards were not adopted by the three ESA Boards, ESAs are not in a position to formally submit the technical standards to EC. For transparency, the draft final report has been included as an Annex to the letter.
Keywords: Europe, EU, Banking, Insurance, Securities, KID, PRIIPs, UCITS, Regulatory Technical Standards, EC, ESAs
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.