ESRB Publishes Its Annual Report for 2017
ESRB published its seventh annual report, which details its achievements and activities between April 01, 2017 and March 31, 2018. During this period, ESRB continued its close monitoring of sources of systemic risk in the European financial system and economy. As part of this work, ESRB analyzed developments in the commercial real estate and the non-bank financial sectors.
The annual report highlights that ESRB identified key risks to financial stability in the EU, which were re-pricing of risk premia in global financial markets; weaknesses in balance sheets of banks, insurers, and pension funds; debt sustainability challenges in sovereign, corporate, and household sectors; and vulnerabilities in the shadow banking system and contagion to the wider financial system. These risks formed the basis for the adverse macro-financial scenario that ESRB provided to EBA for the 2018 EU-wide banking sector stress test. These risks were also reflected in the adverse scenarios that were provided to EIOPA for the 2018 insurance sector stress test. Details of these scenarios are provided in the annual report.
Other key achievements of ESRB during the year are as follows:
- ESRB published a recommendation designed to address systemic risks related to liquidity mismatches and the use of leverage in investment funds; a report discussing the financial stability implications of IFRS 9; and a report on resolving non-performing loans (NPLs) in Europe.
- Another contribution to the macro-prudential framework for banking came in the form of an opinion, which ESRB provided to EC on macro-prudential structural buffers.
- ESRB responded to an ESMA consultation on draft guidelines on anti-procyclicality margin measures for central counterparties.
- ESRB identified areas where the Solvency II framework could be enhanced and advocated the development of a harmonized recovery and resolution framework for the insurance sector across EU.
- ESRB also held the second Annual Conference in September 2017 to facilitate discussion and further develop conceptual thinking about macro-prudential policy. The panel discussions focused on legal perspectives on macro-prudential regulation and the conduct of macro-prudential policy beyond banking. There were sessions on the challenges and future of banking in EU, how to address NPLs in the EU banking sector, and monitoring of risk in the shadow banking system.
Related Link: ESRB Annual Report (PDF)
Keywords: Europe, EU, Banking, Insurance, Annual Report, Macro-prudential Policy, Systemic Risk, Stress Testing, ESRB
Previous Article
HKMA Publishes Rules and Reporting Form for Banking Exposure LimitsRelated Articles
|
News
HKMA Decides to Maintain Countercyclical Capital Buffer at 2.5%HKMA announced that, in accordance with the Banking (Capital) Rules, the countercyclical capital buffer (CCyB) ratio for Hong Kong remains at 2.5%.
April 16, 2019
WebPage
Regulatory News
|
|
News
EP Approves Agreement on Package of CRD 5, CRR 2, BRRD 2, and SRMR 2The European Parliament (EP) approved the final agreement on a package of reforms proposed by EC to strengthen the resilience and resolvability of European banks.
April 16, 2019
WebPage
Regulatory News
|
|
News
FDIC Consults on Approach to Resolution Planning for IDIsFDIC approved an Advance Notice of Proposed Rulemaking (ANPR) and is seeking comment on ways to tailor and improve its rule requiring certain insured depository institutions (IDIs) to submit resolution plans.
April 16, 2019
WebPage
Regulatory News
|
|
News
EP Resolution on Proposal for Sovereign Bond Backed SecuritiesThe European Parliament (EP) published adopted text on the proposal for a regulation of the European Parliament and of the Council on sovereign bond-backed securities (SBBS).
April 16, 2019
WebPage
Regulatory News
|
|
News
PRA Seeks Input and Issues Specifications for Insurance Stress TestsPRA announced that it will conduct an insurance stress test for the largest regulated life and general insurers from July to September 2019.
April 15, 2019
WebPage
Regulatory News
|
|
News
PRA Finalizes Policy on Approach to Managing Climate Change RisksPRA published the policy statement PS11/19, which contains final supervisory statement (SS3/19) on enhancing banks’ and insurers’ approaches to managing the financial risks from climate change (Appendix).
April 15, 2019
WebPage
Regulatory News
|
|
News
EBA Single Rulebook Q&A: First Update for April 2019EBA published answers to nine questions under the Single Rulebook question and answer (Q&A) updates for this week.
April 12, 2019
WebPage
Regulatory News
|
|
News
EIOPA Statement on Application of Proportionality in SCR SupervisionEIOPA published a supervisory statement on the application of proportionality principle in the supervision of the Solvency Capital Requirement (SCR) calculated in accordance with the standard formula.
April 11, 2019
WebPage
Regulatory News
|
|
News
FED Updates Form and Supplemental Instructions for FR Y-9C ReportingFED updated the form and supplemental instructions for FR Y-9C reporting. FR Y-9C is used to collect data from domestic bank holding companies, savings and loan holding companies, U.S intermediate holding companies, and securities holding companies with total consolidated assets of USD 3 billion or more.
April 11, 2019
WebPage
Regulatory News
|
|
News
OSFI Finalizes Guidelines on Liquidity Adequacy and NSFR DisclosuresOSFI published the final Liquidity Adequacy Requirements (LAR) guideline and the net stable funding ratio (NSFR) disclosure requirements guideline.
April 11, 2019
WebPage
Regulatory News
|
