IAIS published its newsletter describing the activities and achievements this month. The June issue of the newsletter highlights the rising importance of fintech, discusses activities and progress in the area of ComFrame, and announces that the Eleventh Annual IAIS Global Seminar will be held in Moscow on July 26-27.
The IAIS Secretary General highlighted that the greatest demand coming from IAIS members has been for guidance on proactive supervisory practices that present a robust response to a fast changing environment—in particular, on fintech and cyber security risks. These are issues that impact supervisors from both developed and developing jurisdictions. The demand is less about setting new standards and more about understanding how to apply existing standards through supervisory practices that appropriately help monitor and respond to these new circumstances. IAIS has undertaken some important work on the emerging topics of fintech and cyber risk, but more can and will be done. Supervisory guidance on market conduct and financial inclusion aspects of fintech and supervision of cyber resilience of insurers is forthcoming this year. IAIS is also putting in place a FinTech Forum for the exchange of ideas and lessons among supervisory experts, helping to inform a more agile response.
Other key highlights this month are as follows:
- On 26-27 July, IAIS, along with stakeholders and others, will gather in Moscow, Russia, for the 11th Annual IAIS Global Seminar. Day One will feature panel sessions on ComFrame, including the Insurance Capital Standard (ICS); the IAIS systemic risk framework, including work on an activities-based approach to systemic risk assessment; and insurance in support of inclusive economic development. Day Two will turn to emerging risks by focusing on climate change and cyber risk, while also discussing the use of innovation facilities such as sandboxes as a regulatory tool.
- The Policy Development Committee met on June 13 and discussed the Draft Application Paper on the Composition and the Role of the Board; Draft Application Paper on Supervision of Insurer Cybersecurity; Draft revised ICP 6 (Changes in Control and Portfolio Transfer) and ICP 20 (Public Disclosure); and Key issues for ICS Version 2.0.
- The Capital, Solvency and Field Testing Working Group (CSFWG) met the week of May 22-25 to discuss the ICS Version 2.0 consultation document. The CSFWG also met in Washington DC on June 18-22 to finalize the draft ICS Version 2.0 consultation document. The consultation will be launched this summer for a three-month consultation period.
- The CSFWG continues to work on revisions to ICP 15 (Investment) and ICP 16 (Enterprise Risk Management for Solvency Purposes) and integrated ComFrame as a result of the consultation in November 2017. The revised ComFrame material will be part of the overall ComFrame consultation that will be released this summer.
- At its meeting on June 12-13, the Governance Working Group discussed the ComFrame material related to governance (integrated into ICP 5 (Suitability of Persons), ICP 7 (Corporate Governance), and ICP 8 (Risk Management and Internal Controls), in preparation for the public consultation of the overall ComFrame planned for August.
- At its meeting on June 14-15, the Insurance Groups Working Group discussed the ComFrame material integrated into ICP 9 (Supervisory Review and Reporting), ICP 10 (Preventive and Corrective Measures), ICP 23 (Group-wide Supervision), and ICP 25 (Supervisory Cooperation and Coordination).
Keywords: International, Insurance, Newsletter, ComFrame, ICP, ICS, FinTech, IAIS
PRA, via the consultation paper CP12/20, proposed changes to its rules, supervisory statements, and statements of policy to implement certain elements of the Capital Requirements Directive (CRD5).
EIOPA published the financial stability report that provides detailed quantitative and qualitative assessment of the key risks identified for the insurance and occupational pensions sectors in the European Economic Area.
EBA published its risk dashboard for the first quarter of 2020 together with the results of the risk assessment questionnaire.
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.
PRA published the consultation paper CP11/20 that sets out its expectations and guidance related to auditors’ work on the matching adjustment under Solvency II.
MAS published a statement guidance on dividend distribution by banks.
APRA updated its capital management guidance for banks, particularly easing restrictions around paying dividends as institutions continue to manage the disruption caused by COVID-19 pandemic.
FSB published a report that reviews the progress on data collection for macro-prudential analysis and the availability and use of macro-prudential tools in Germany.
EBA issued a statement reminding financial institutions that the transition period between EU and UK will expire on December 31, 2020; this will end the possibility for the UK-based financial institutions to offer financial services to EU customers on a cross-border basis via passporting.
SRB published guidance on operational continuity in resolution and financial market infrastructure (FMI) contingency plans.