BaFin launched a consultation (16/2020) on revisions to the circular on the minimum requirements for the feasibility of a bail-in. BaFin had published the original circular on the minimum requirements for the feasibility of a bail-in on July 04, 2019. The planned new version of the circular is aimed at all institutions under the direct responsibility of BaFin as the national resolution authority, for which no insolvency scenario has been defined as a resolution strategy. The consultation closes on December 16, 2020.
The draft version contains requirements for the management information systems of the concerned institutions. The requirements are intended to ensure provision of the information necessary for an effective and efficient implementation of the resolution instruments, for the participation of the holders of relevant capital instruments; creditor participation in accordance with Sections 89 and 90 of the Reorganization and Resolution Act is essential. The revised version of the circular also includes requirements for the technical and organizational equipment to ensure that the information can be provided within 24 hours of being requested by the resolution authority. Minimum requirements for the feasibility of a bail-in are also to be expanded in certain other areas. The main extensions relate to additional data points for the further development of the external bail-in implementation, the extension to all bail-in-capable liabilities (taking into account the principle of proportionality), and the inclusion of a catalog of frequently asked questions.
Related Links (in German)
Comment Due Date: December 16, 2020
Keywords: Europe, Germany, Banking, Bail-In, Resolution Planning, Resolution Framework, BaFin
Previous ArticleIASB Begins First Phase of Post-Implementation Review of IFRS 9
BIS Innovation Hub published the work program for 2021, with focus on suptech and regtech, next-generation financial market infrastructure, central bank digital currencies, open finance, green finance, and cyber security.
In an article published by SRB, Mairead McGuinness, the European Commissioner for Financial Services, Financial Stability, and Capital Markets Union, discussed the progress and next steps toward completion of the Banking Union.
EBA finalized the two sets of draft regulatory technical standards on the identification of material risk-takers and on the classes of instruments used for remuneration under the Investment Firms Directive (IFD).
EC published, in the Official Journal of the European Union, a notification that the European Court of Auditors (ECA) has published a special report on resolution planning in the Single Resolution Mechanism.
BoE published a scenario against which it will be stress testing banks in 2021, in addition to setting out the key elements of the 2021 stress test, guidance on the 2021 stress test, and the variable paths for the 2021 stress test.
PRA published a consultation paper (CP3/21) proposes rules regarding the timing of identity verification required for eligibility of depositor protection under the Financial Services Compensation Scheme (FSCS).
FSB published the work program for 2021, which reflects a strategic shift in priorities in the COVID-19 environment.
FCA announced that 50% firms have started using the new data collection platform RegData, which is slated to replace the existing platform known Gabriel.
Bundesbank published Version 5.0 of the derivation rules for completeness check at the form level, with respect to the data quality of the European harmonized reporting system.
FED finalized a rule that updates capital planning requirements to reflect the new framework from 2019 that sorts large banks into categories, with requirements that are tailored to the risks of each category.