Under the Single Rulebook question and answer (Q&A) updates for this week, EBA published one answer regarding minimum requirement for own funds and eligible liabilities (MREL). In addition, EBA rejected a question related to the Deposit Guarantee Scheme, which had asked for rationale behind the answer to the Q&A question ID 2017_3357, as EBA believes that the matter it refers to has already been answered.
The initial EBA answer to the rejected question states that liabilities referred to under Article 28(1) of Delegated Regulation (EU) 2015/61 shall receive an outflow rate of 20% in accordance with that Article only where their entire amount is fully covered by a deposit guarantee scheme in accordance with Directive 94/19/EC or Directive 2014/49/EU or an equivalent deposit guarantee scheme in a third country. Where the liability exceeds the deposit guarantee limit, a 40% outflow rate shall apply to the entire amount of the liability. The rejected question had asked why is it necessary for the Liabilities referred to under Article 28(1) of Delegated Regulation (EU) 2015/61 to be in their entire amount fully covered by a deposit guarantee scheme to receive an outflow rate of 20%, if mentioned Liabilities are insured to be quickly and effortlessly returned to their depositors in the amount of deposit guarantee scheme limit if credit institution defaults, so depositors would not have to participate in a long-term bankruptcy proceedings for guaranteed amount.
The overall objective of the Q&A tool is to ensure consistent and effective application of the new regulatory framework across the Single Market. Institutions, supervisors, and other stakeholders can use the Single Rulebook Q&A tool for submitting questions on Capital Requirements Directive IV (CRD IV), Capital Requirement Regulation (CRR), and the related technical standards that have been developed by EBA and adopted by EC.
Keywords: Europe, EU, Banking, Single Rulebook, Q&A, CRR, CRD IV, MREL, Resolution, EBA
Previous ArticleAPRA Informs RSE Licensees About Reforms to Address Account Erosion
BIS Innovation Hub published the work program for 2021, with focus on suptech and regtech, next-generation financial market infrastructure, central bank digital currencies, open finance, green finance, and cyber security.
In an article published by SRB, Mairead McGuinness, the European Commissioner for Financial Services, Financial Stability, and Capital Markets Union, discussed the progress and next steps toward completion of the Banking Union.
EBA finalized the two sets of draft regulatory technical standards on the identification of material risk-takers and on the classes of instruments used for remuneration under the Investment Firms Directive (IFD).
EC published, in the Official Journal of the European Union, a notification that the European Court of Auditors (ECA) has published a special report on resolution planning in the Single Resolution Mechanism.
BoE published a scenario against which it will be stress testing banks in 2021, in addition to setting out the key elements of the 2021 stress test, guidance on the 2021 stress test, and the variable paths for the 2021 stress test.
PRA published a consultation paper (CP3/21) proposes rules regarding the timing of identity verification required for eligibility of depositor protection under the Financial Services Compensation Scheme (FSCS).
FSB published the work program for 2021, which reflects a strategic shift in priorities in the COVID-19 environment.
FCA announced that 50% firms have started using the new data collection platform RegData, which is slated to replace the existing platform known Gabriel.
Bundesbank published Version 5.0 of the derivation rules for completeness check at the form level, with respect to the data quality of the European harmonized reporting system.
FED finalized a rule that updates capital planning requirements to reflect the new framework from 2019 that sorts large banks into categories, with requirements that are tailored to the risks of each category.