Featured Product

    EBA Opinion and Report on Regulatory Perimeter Issues Under CRD IV/CRR

    November 09, 2017

    EBA published an opinion and a report on matters related to the other financial intermediaries (OFIs) and the regulatory perimeter issues under the Capital Requirements Directive/Regulation (CRD IV/CRR). These matters include the use of Articles 2(5) and 9(2) CRD IV (Directive 2013/36/EU) and the interpretation of the terms “financial institution” and “ancillary services undertaking,” as defined in the CRR (Regulation (EU) No 575/2013). The EBA opinion is addressed to the European Parliament, Council, and the EC.

    The opinion is based on the results of a detailed assessment, across the EU, of the prudential treatment of OFIs—that is, the entities carrying out credit intermediation activities that are not credit institutions nor other specified types of financial entity. The report published by EBA includes the results of the assessment of the use of Articles 2(5) and 9(2) CRD IV; the prudential treatment of OFIs under national law; the definitions of ancillary services undertaking and financial institution; and Annex I to the CRD IV. EBA's findings are relevant to the consideration of the legislative proposals to amend the CRD IV/CRR.

    EBA undertook a comprehensive analysis of issues related to the regulatory perimeter further to the 2014 EBA Opinion and Report on the perimeter of credit institutions. This is in view of the need for the regular monitoring of credit intermediation activities outside the traditional banking sector and other developments such as the emergence of fintech. In terms of the overall scope of the CRD IV/CRR, EBA observes that Article 2(5) CRD IV remains valid and requires minor update. Also Article 9(2) CRD IV also appears to continue to have relevance in the member states and any amendment thereto ‎should be substantiated by a prior and thorough impact assessment. ‎As for the terms "financial institution" and "ancillary services undertaking," which are crucial for establishing the scope of prudential consolidation, EBA notes that these terms are prone to inconsistent interpretation across the EU, thus leading to potential divergences in the application of regulatory consolidation rules. EBA urges the institutions in EU to consider further possible amendments to the definitions of these terms, to ensure consistent treatment of prudential risks and to promote a level playing field.

    EBA also notes a significant variation in the prudential treatment of OFIs under national laws. Although EBA is not making specific recommendations on the scope of individual prudential regulation under EU law, EBA observes the need to continue its monitoring work, including in conjunction with ESRB, as part of the annual shadow banking monitoring exercises. EBA highlights that Annex I to the CRD IV, which enlists the activities subject to mutual recognition, has been largely unchanged for 30 years and urges the EU institutions to consider clarifications and updates to the Annex.


    Related Links

    Keywords: Europe, EU, Banking, Regulatory Perimeter, CRD IV, CRR, OFI, EBA

    Related Articles
    News

    APRA Consults on Standard for Reporting of COVID-19 Loans

    APRA issued a letter to authorized deposit-taking institutions announcing its intent to formalize the capital measures and reporting requirements for COVID-19 loans through temporary legislative instruments.

    August 13, 2020 WebPage Regulatory News
    News

    EBA Consults Industry on Use and Uptake of Regtech Solutions Across EU

    EBA is inviting relevant stakeholders, such as financial institutions and information and communication technology (ICT) third-party providers, to share their views and experience on the use of regtech solutions through its regtech industry survey.

    August 12, 2020 WebPage Regulatory News
    News

    BoE Clarifies Approach to Treatment of Payment Holidays on Form PL

    BoE published a statistical notice (Notice 2020/9) explaining the approach for treatment of payment holidays on the profit and loss return or Form PL.

    August 11, 2020 WebPage Regulatory News
    News

    FASB to Conduct Post-Implementation Review of CECL Standard

    FASB announced the launch of its new Post-Implementation Review (PIR) web portal.

    August 11, 2020 WebPage Regulatory News
    News

    EBA Guidance on Impact of CRR Quick-Fix on Reporting and Disclosures

    EBA revised the draft implementing technical standards on supervisory reporting as part of the reporting framework 3.0.

    August 11, 2020 WebPage Regulatory News
    News

    ECB Examines ICAAP Practices of Banks in EU

    ECB published report that presents a summary of the analysis conducted on the internal capital adequacy assessment process (ICAAP) practices of a sample of 37 "significant" banks.

    August 11, 2020 WebPage Regulatory News
    News

    BoE Provides Reporting Update on Form AS and Form FV

    BoE updated the known issues document for the statistical reporting Forms AS and FV.

    August 10, 2020 WebPage Regulatory News
    News

    FED Announces Capital Requirements for Large Banks

    FED announced individual capital requirements for 34 large banks and these requirements go into effect on October 01, 2020.

    August 10, 2020 WebPage Regulatory News
    News

    SRB Publishes Guidance on Implementation of Bail-In Tool

    SRB published a set of documents to give operational guidance to banks on implementation of the bail-in tool.

    August 10, 2020 WebPage Regulatory News
    News

    BIS Publishes Update on G20 TechSprint Initiative

    BIS published an update on the G20 TechSprint Initiative, which was launched in April 2020 and aims to highlight the potential for technologies to resolve regulatory compliance (regtech) and supervisory (suptech) challenges.

    August 10, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5658