BaFin has released new developments and important information about COVID-19 and its effects on the financial and banking system. In addition, BaFin published frequently asked questions regarding banking and securities supervision. The answers to FAQs provide clarifications on topics related to credit risk, governance, FINREP, IFRS 9, Capital Requirements Regulation/Directive (CRR 2/CRD 5), liquidity risk, and reporting system. For certain reports, in particular those based on the FinaRisikoV (ordinance for the submission of financial and risk-bearing capacity information according to the German Banking Act) and the million credit reporting system, BaFin and Deutsche Bundesbank will not take up late submissions from the banking authorities and will allow an additional modified submission method for master data reports for large and million credit reporting systems.
BaFin has adopted a large number of measures to increase the scope for lending and, if necessary, absorb losses. Against this background and in view of the high degree of uncertainty about future developments, BaFin recommends refraining from buying back shares and carefully weighing dividends, profits, and bonuses. BaFin also advises to apply the transition rules to the IFRS 9 accounting standard. In the case of corona-related payment delays, a "through the cycle" perspective should be taken, which also takes into account state measures to mitigate the economic consequences. The dialog with the accounting standard-setters on these issues will continue at the national and international levels.
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Keywords: Europe, Germany, Banking, Securities, COVID-19, Reporting, Credit Risk, IFRS 9, FAQ, FINREP, Governance, CRR2, CRD5, Liquidity Risk, Bundesbank, BaFin
BCBS Finalizes Revisions to Credit Valuation Adjustment Risk Framework
PRA published a statement to insurers that clarifies the approach to application of the matching adjustment during COVID-19 crisis.
EBA published a report on the implementation of selected COVID-19 policies within the prudential framework for banking sector.
EC launched a consultation to revise the network and information systems (NIS) Directive (2016/1148), which was adopted in July 2016 and is the first horizontal internal market instrument aimed at improving the resilience of the EU against cybersecurity risks.
PRA published a statement that outlines its view on the implications of LIBOR transition for contracts in scope of the “Contractual Recognition of Bail-In” and “Stay in Resolution” parts of the PRA Rulebook.
PRA published the policy statement PS15/20 to reflect additional resilience associated with higher macro-prudential buffers in a standard risk environment with a reduction in Pillar 2A capital requirements.
BCBS published the eighteenth progress report on implementation of the Basel III regulatory framework in member jurisdictions.
FCA announced proposals that would provide continued support for certain consumer credit products to users, who are facing a financial impact because of the exceptional circumstances arising from the COVID-19 pandemic.
ACPR published a draft version of taxonomy RAN 1.4.0_PWD1, along with the related documentation, for Solvency II reporting.
BCBS amended the guidelines on sound management of risks related to money laundering and financing of terrorism (ML/FT).