EBA announced that the next stress testing exercise is expected to be launched at the end of January 2021 and its results are to be published at the end of July 2021. Earlier, EBA had postponed the stress testing exercise in light of the unprecedented disruptions caused by the COVID-19 outbreak. EBA also published a list with a tentative sample of participating banks, including the banks that were going to participate in the postponed 2020 stress test, with some adjustments to ensure sufficient coverage in terms of total assets as well as to reflect changed conditions for specific institutions.
From the listed sample of banks, UK banks have been excluded while their EU-27 subsidiaries have been included, as necessary. The final sample list can still be subject to adjustments, depending on possible mergers, divestments, and restructurings, among others. The 2021 EU-wide stress test will be carried out at the highest level of consolidation on a sample of 51 banks, of which 39 are from the Euro area, covering broadly 70% of the banking sector in the euro area, each non-Eurozone member states, and Norway.
Additionally, the Board of Supervisors of EBA have agreed on the preliminary timeline for the potential changes to the EU-wide stress test framework. A final decision on potential changes to the framework, which takes account of the feedback received on the discussion paper published in January 2020, is expected to be taken in second or third quarter of 2021. The implementation of any potential change will be possible for the 2023 EU-wide stress test.
- Press Release
- Sample of Banks (PDF)
- Discussion Paper, January 2020 (PDF)
- Overview of EU-Wide Stress Testing
Keywords: Europe, EU, Banking, EU-Wide Stress Test, Timeline, Stress Testing, 2023 Stress Test, 2021 Stress Test, COVID-19, EBA
Previous ArticleRBNZ Outlines Regulatory Priorities for 2020-2023
HM Treasury announced that the new Financial Services Bill has been introduced in the Parliament.
PRA published the consultation paper CP17/20 to propose changes to certain rules, supervisory statements, and statements of policy to implement elements of the Capital Requirements Directive (CRD5).
US Agencies adopted a final rule that applies to advanced approaches banking organizations and aims to reduce interconnectedness in the financial system as well as to reduce contagion risks associated with the failure of a global systemically important bank (G-SIB).
US Agencies (FDIC, FED, and OCC) adopted a final rule that implements the net stable funding ratio (NSFR) for certain large banking organizations.
FSB finalized the toolkit of effective practices to assist financial institutions in their cyber incident response and recovery activities.
ECB published eleventh issue of the Macroprudential Bulletin, which provides insight into the ongoing work of ECB in the field of macro-prudential policy.
HM Treasury issued a call for evidence seeking views to reform the prudential regulatory regime—also known as Solvency II—of the insurance sector in UK.
ESRB responded to the EC consultation on review of Solvency II regime.
HM Treasury launched a consultation on Phase II of the Future Regulatory Framework Review, with the comment period ending on January 19, 2021.
EC adopted the work program for 2021.