As part of the measures to foster recovery from the COVID-19 crisis, EU announced its support for the reform efforts of member states to stimulate growth and put their economies back on track. In this context, the EU ambassadors endorsed the position of the European Council on establishing a "technical support instrument," that will contribute to mainstreaming climate actions and to the achievement of an overall target of the EU budget expenditures supporting climate objectives. The technical support instrument is also meant to complement the EC proposal for a recovery and resilience facility that will provide large-scale financial support for public investments and reforms to foster member states' recovery from the COVID-19 crisis. The instrument will support member states in the preparation and implementation of their recovery and resilience plans.
Member states have increasingly taken up technical support under the Structural Reform Support Program in the past; therefore, a technical support instrument should be established through a regulation, with a view to continuing to support member states in the implementation of reforms. Reflecting the European Green Deal as Europe’s growth strategy and the translation of EU’s commitments to implement the Paris Agreement and the United Nations’ Sustainable Development Goals, the technical support instrument will contribute to mainstreaming climate actions and to the achievement of an overall target of % of the EU budget expenditures supporting climate objectives. Relevant actions should be identified during the instrument’s preparation and implementation and reassessed in the context of the relevant evaluations and review processes. This should also tackle broader environmental and social challenges in EU, including the protection of natural capital and the support to the circular economy and be in line with the 2030 Agenda for Sustainable Development.
The scope of the instrument includes financial-sector policies, such as those for the promotion of financial literacy, financial stability, access to finance and lending to the real economy and production, provision, and quality monitoring of data and statistics. It also covers policies for implementing the digital and the green transitions, e-government solutions, e-procurement, connectivity, data access and governance, and e-learning; the use of artificial-intelligence-based solutions, the environmental pillar of sustainable development and environmental protection, climate action; promoting the circular economy, energy and resource efficiency, and renewable energy sources; achieving energy diversification; and ensuring energy security.
The agreed upon position will serve as the basis for the Presidency in its negotiations with the European Parliament that are set to start as soon as possible. However, it does yet not cover the budgetary aspects of the draft regulation since an agreement on the overall next Multiannual Financial Framework was achieved only yesterday. The proposed technical support instrument is a successor to the structural reform support program. On the basis of this partial negotiating mandate, the Presidency will start negotiations with the Parliament as soon as the Parliament has adopted its position.
Keywords: Europe, EU, Banking, Insurance, Securities, ESG, Climate Change Risk, COVID-19, Financial Stability, European Green Deal, Paris Agreement, EC, European Council
BCBS is consulting on the principles for operational resilience and the revisions to the principles for sound management of operational risk for banks.
The Financial Stability Institute (FSI) of BIS published a brief note that examines the supervisory challenges associated with certain temporary regulatory relief measures introduced by BCBS and prudential authorities in response to the COVID-19 pandemic.
HKMA, together with the Banking Sector Small and Medium-Size Enterprise (SME) Lending Coordination Mechanism, announced a ninety-day repayment deferment for trade facilities under the Pre-approved Principal Payment Holiday Scheme.
The Advisory Scientific Committee of ESRB published a response, in the form of an Insights Paper, to the EBA proposals for reforms to the stress testing framework in EU.
MAS announced several initiatives to support adoption of the Singapore Overnight Rate Average (SORA), which is administered by MAS.
BoE updated the reporting template for Form ER as well as the Form ER definitions, which contain guidance on the methodology to be used in calculating annualized interest rates.
PRA published the policy statement PS19/20 on the final policy for extending coverage under the Financial Services Compensation Scheme (FSCS) for Temporary High Balance.
EBA published the final draft implementing technical standards for disclosures and reporting on the minimum requirements for own funds and eligible liabilities (MREL) and the total loss-absorbing capacity (TLAC) requirements in EU.
EBA published an erratum for the phase 2 of technical package on the reporting framework 2.10.
EC published the Implementing Regulation 2020/1145, which lays down technical information for calculation of technical provisions and basic own funds.