Featured Product

    EBA Issues Guidelines for Banks and Investment Firms Under CRD and IFD

    June 30, 2022

    The European Banking Authority (EBA) published the guidelines on the data collection exercises regarding high earners as well as the guidelines on the remuneration and gender pay gap benchmarking exercise under the Capital Requirements Directive (IFD) and the Investment Firms Directive (CRD).

    The guidelines on remuneration benchmarking exercise integrate additional requirements introduced by CRD5 regarding the application of derogations and the benchmarking of gender pay gap. EBA also added guidance to harmonize the benchmarking of approvals granted by shareholders to use higher ratios than 100% between the variable and fixed remuneration. EBA provided separate guidelines on the remuneration and gender pay gap benchmarking exercise for investment firms under the IFD. Both the Guidelines for credit institutions and the new Guidelines for investment firms integrate changes made to the remuneration and disclosure requirements under the CRD and the Capital Requirements Regulation (CRR) as well as the new remuneration framework for investment firms under the IFD and the Investment Firms Regulation (IFR). The approach taken in the guidelines for investment firms is consistent with the corresponding guidelines for banks. In accordance with the principle of equal pay for equal work or work of equal value and measures to ensure equal opportunities, the benchmarking of the gender pay gap will allow competent authorities to monitor the implementation of such measures and their development at different levels of pay. EBA introduced templates for the benchmarking of the gender pay gap and revised the templates for the data collection, in light of the European Commission’s Implementing Regulation on disclosures. Benchmarking data will be collected annually under the updated guidelines while the first data collection will be conducted in 2023 for the financial year 2022. The first data on the gender pay gap will be collected in 2024 for the financial year 2023. The updated guidelines will come in effect from December 31, 2022.  

    The guidelines on data collection exercise on high earners reflect the amended remuneration framework laid down in CRD5, including the introduction of derogations to pay out a part of the variable remuneration in instruments and under deferral arrangements. The need to update these guidelines stemmed from the remuneration regime introduced for investment firms and laid down in IFD and IFR. EBA has updated the templates and instructions accordingly and provided a specific template for high earners in investment firms. The CRD and the IFD require competent authorities to collect information on the number of natural persons, per institution and investment firm, respectively, who are remunerated EUR 1 million or more per financial year, in pay brackets of EUR 1 million. The information should also include details on their job responsibilities, the business area, and the main elements of the salary, bonus, long-term award, and pension contribution. The data regarding high earners under the updated guidelines will be collected annually in 2023, for the financial year that ends in 2022. Data on high earners should be submitted by the firms to the competent authorities by August 31, 2023 and from the competent authorities to the EBA by October 31, 2023. The updated guidelines will come in effect from December 31, 2022.

     

    Related Links

     

     

    Keywords: Europe, EU, Banking, Central Bank Liquidity, Basel, Operational Risk, Guidelines, CRD, IFD, CRR, IFR, Investment Firms, Disclosures, Benchmarking Exercise, Reporting, Remuneration Benchmarking, High Earners Data, EBA

    Featured Experts
    Related Articles
    News

    ESAs Issue Multiple Regulatory Updates for Financial Sector Entities

    The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.

    November 15, 2022 WebPage Regulatory News
    News

    ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments

    The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.

    November 10, 2022 WebPage Regulatory News
    News

    IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets

    The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.

    November 09, 2022 WebPage Regulatory News
    News

    EBA Finalizes Methodology for Stress Tests, Issues Other Updates

    The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups

    November 09, 2022 WebPage Regulatory News
    News

    OSFI Sets Out Work Priorities and Reporting Updates for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.

    November 07, 2022 WebPage Regulatory News
    News

    APRA Finalizes Changes to Capital Framework, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.

    November 03, 2022 WebPage Regulatory News
    News

    BIS Hub and Central Banks Conduct CBDC and DeFI Pilots

    The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.

    November 03, 2022 WebPage Regulatory News
    News

    ECB Sets Deadline for Banks to Meet Its Climate Risk Expectations

    The European Central Bank (ECB) published the results of its thematic review, which shows that banks are still far from adequately managing climate and environmental risks.

    November 02, 2022 WebPage Regulatory News
    News

    ESAs, ECB, & EC Issue Multiple Regulatory Updates for Financial Sector

    Among its recent publications, the European Banking Authority (EBA) published the final standards and guidelines on interest rate risk arising from non-trading book activities (IRRBB)

    October 31, 2022 WebPage Regulatory News
    News

    EC Adopts Final Rules Under CRR, BRRD, and Crowdfunding Regulation

    The European Commission (EC) recently adopted regulations with respect to the calculation of own funds requirements for market risk, the prudential treatment of global systemically important institutions (G-SIIs)

    October 26, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8582