EC Adopts Rules on Investments in STS Securitizations for Insurers
EC adopted new rules, via a Delegated Regulation, to stimulate investments of insurance companies in simple, transparent, and standardized (STS) securitization. The rules will apply as of January 01, 2019 if the European Parliament and the Council raise no objection to it. The rules will provide for a more risk-sensitive approach in the calculation of the amount of capital that insurers need to set aside when they invest in STS securitizations.
These amendments will make Solvency II, which is the EU insurance legislation, compatible with the harmonized rules on STS securitization, which were adopted by co-legislators in 2017. This will contribute to the creation of an integrated Capital Markets Union. The amendments are also in line with the revised prudential treatment of banks' investments set out in the STS securitization framework. The new rules will:
- Replace the current distinction between “type 1” and “type 2” securitization with the distinction between STS and non-STS securitization
- Replace the sector-specific provisions on due diligence and risk retention with references to the harmonized STS framework
- Introduce risk-sensitive capital requirements for senior and non-senior tranches of STS securitization
- Provide for transitional rules concerning investments in securitization that were issued prior to application of the STS framework
Related Links
Effective Date: January 01, 2019 (subject to agreement of European Parliament and Council)
Keywords: Europe, Insurance, STS Securitization, Solvency II, Delegated Regulation, EC
Previous Article
BDE Issues Technical Instructions for Financial Reporting by BanksRelated Insights
|
News
FSB Report Examines Financial Stability Implications of FintechFSB published a report that assesses fintech-related market developments and their potential implications for financial stability.
February 14, 2019
WebPage
Regulatory News
|
|
News
US Agencies Amend Regulatory Capital Rule to Allow Phase-In for CECLUS Agencies (FDIC, FED, and OCC) adopted the final rule to address changes to credit loss accounting under the U.S. generally accepted accounting principles; this includes banking organizations’ implementation of the current expected credit losses (CECL) methodology.
February 14, 2019
WebPage
Regulatory News
|
|
News
OCC Consults on Company-Run Stress Test Requirements for BanksOCC proposed amendments to its company-run stress testing requirements for national banks and Federal savings associations, consistent with section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act.
February 12, 2019
WebPage
Regulatory News
|
|
News
CFTC Extends Comment Periods for Trade Execution Requirement ProposalsCFTC announced that it is extending comment period for the proposed amendments related to the regulations on swap execution facilities (SEF) and trade execution requirement.
February 12, 2019
WebPage
Regulatory News
|
|
News
OCC Proposes to Renew Information Collection Under Stress Test RuleOCC is proposing to renew its information collection titled “Annual Stress Test Rule” (OMB Control No: 1557-0311). Comments must be received on or before March 13, 2019.
February 11, 2019
WebPage
Regulatory News
|
|
News
OSFI Consults on NSFR Disclosure Requirements for D-SIBsOSFI proposed the draft guideline on the net stable funding ratio (NSFR) disclosure requirements for domestic systemically important banks (D-SIBs).
February 11, 2019
WebPage
Regulatory News
|
|
News
EC Amends Its Regulation to Clarify Impairment Requirements for IFRS 9EC published the EU Regulation 2019/237 that amends Regulation (EC) No 1126/2008 adopting certain international accounting standards, in accordance with Regulation (EC) No 1606/2002 regarding International Accounting Standard (IAS) 28 on Investments in Associates and Joint Ventures.
February 11, 2019
WebPage
Regulatory News
|
|
News
FSB Chair Randal Quarles Speaks About the Upcoming Work of FSBWhile speaking at the BIS Special Governors Meeting in Hong Kong, Randal K. Quarles, the Chair of FSB and Vice Chair of FED, discussed his views on how the work of FSB must evolve and the key principles that, he believes, should inform that work.
February 10, 2019
WebPage
Regulatory News
|
|
News
OSFI Proposes to Amend the Liquidity Adequacy Requirements for BanksOSFI proposed revisions to the Liquidity Adequacy Requirements (LAR) Guideline for banks. OSFI published the proposed drafts (with proposed changes highlighted in yellow) of Chapters 1,2, 4, and 5 of the LAR guideline.
February 08, 2019
WebPage
Regulatory News
|
|
News
HKMA Publishes FAQs on Local Implementation of IRRBB FrameworkHKMA published the frequently asked questions (FAQs) related to the local implementation of the interest rate risk in the banking book (IRRBB).
February 08, 2019
WebPage
Regulatory News
|
