Featured Product

    PRA Further Reprioritizes Work to Support Firms Amid COVID Crisis

    May 07, 2020

    PRA published a statement detailing plans to support firms in focusing their resources on the highest priority work amid COVID-19 outbreak. The announcement covers tasks related to climate change risks, calculation of stressed value-at-risk (SVAR), data reporting for LIBOR transition, and postponement of the insurance stress test. Overall, PRA continues to consider and make other adjustments to ease the burden on regulated entities. BoE also published its interim financial stability report, which covers views on performance of the financial system during the COVID-19-related disruption and the resulting outlook for UK financial stability.

    Announcements on climate change work

    The Prudential Regulation Committee (PRC) and the Financial Policy Committee (FPC) agreed to postpone the launch of the climate biennial exploratory scenario exercise until at least mid-2021. BoE will continue to work to better understand and mitigate the climate change risks:

    • PRA will issue follow-on guidance on the supervisory statement (SS3/19) on enhancing firms’ approaches to managing the financial risks from climate change. Furthermore, the outputs from the Climate Financial Risk Forum will be published in the Summer.
    • BoE will work with other central banks within the Network for Greening the Financial System, through which guides on key issues like supervision and scenario analysis will shortly be published. 
    • BoE will also assist the government with its preparations for COP26. The "COP26 Private Finance Agenda" was launched to help private finance support the economy's transition to net zero. 
    • BoE will continue to focus on embedding climate disclosure across the financial system, including through its own disclosures.

    Other reprioritizations or relaxations

    • In an earlier supervisory statement on market risk (SS13/13), PRA had set expectations on how the twelve-month period used for SVAR should be calculated and how frequently it should be reassessed. PRA is now confirming that it does not expect firms to update their SVAR twelve-month period during the current period of financial market stress, other than if a firm’s current period no longer represents a significant period of stress for the portfolio of the firm. PRA will permit firms to delay the review of the choice of historical data until December 2020, in line with the EBA guidance.  
    • Due to COVID-19, PRA and FCA suspended transition data reporting at the end of the first quarter and cancelled certain firm meetings, which were to be held in the first quarter. In light of the developments since, PRA and FCA have decided to resume full supervisory engagement on LIBOR from June 01, 2020, including data reporting at the end of the second quarter.
    • PRA decided to pause further work on the Insurance Stress Test, given other pressures on firms and the need to focus on COVID-19 specific stresses. PRA will, therefore, not be publishing the results of last year’s test and will postpone the next Insurance Stress Test to 2022, with a view to seeking feedback from firms on the proposed design during the fourth quarter of 2021. 

     

    Related Links

    Keywords: Europe, UK, Banking, Insurance, Securities, COVID-19, Climate Change Risk, Financial Stability Report, LIBOR, Deadline Extension, ESG, Stress Testing, Value-at-Risk, CRR, Reporting, Market Risk, BoE, PRA

    Featured Experts
    Related Articles
    News

    OSFI Discusses Benchmark Rate Transition, Sets Out Work Priorities

    The Office of the Superintendent of Financial Institutions (OSFI) published the strategic plan for 2022-2025 and the departmental plan for 2022-23.

    May 17, 2022 WebPage Regulatory News
    News

    EBA Proposes Standards to Support Secondary NPL Markets

    The European Banking Authority (EBA) is consulting, until August 31, 2022, on the draft implementing technical standards specifying requirements for the information that sellers of non-performing loans (NPLs) shall provide to prospective buyers.

    May 17, 2022 WebPage Regulatory News
    News

    EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution

    The European Council and the Parliament reached an agreement on the revised Directive on security of network and information systems (NIS2 Directive).

    May 13, 2022 WebPage Regulatory News
    News

    EBA Issues Standards for Crowdfunding Service Providers Under ECSPR

    The European Banking Authority (EBA) published the final draft regulatory technical standards specifying information that crowdfunding service providers shall provide to investors on the calculation of credit scores and prices of crowdfunding offers.

    May 13, 2022 WebPage Regulatory News
    News

    EU to Amend Credit Risk Adjustment Rules; ESAs Submit Queries on SFDR

    The European Council published a draft Commission Delegated Regulation to amend the regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    May 13, 2022 WebPage Regulatory News
    News

    EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution

    The European Securities and Markets Authority (ESMA) published a paper that examines the systemic risk posed by increasing use of cloud services, along with the potential policy options to mitigate this risk.

    May 12, 2022 WebPage Regulatory News
    News

    MAS Amends Notice 635 and Issues Second Proposal on Green Taxonomy

    The Monetary Authority of Singapore (MAS) published amendments to Notice 635, which sets out requirements that a bank in Singapore has to comply with when granting an unsecured non-card credit facility to individuals.

    May 12, 2022 WebPage Regulatory News
    News

    EC Consults on PSD2 and Open Finance; EU Reaches Agreement on DORA

    The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.

    May 11, 2022 WebPage Regulatory News
    News

    EC Mandates ESAs to Propose Amendments to SFDR Technical Standards

    The European Commission (EC) has issued two letters mandating the European Supervisory Authorities (ESAs) to jointly propose amendments to the regulatory technical standards under Sustainable Finance Disclosure Regulation or SFDR.

    May 11, 2022 WebPage Regulatory News
    News

    EBA Examines Supervisory Practices, Issues Deposits Reporting Template

    The European Banking Authority (EBA) published its annual report on convergence of supervisory practices for 2021. Additionally, following a request from the European Commission (EC),

    May 11, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8196