ECB published a special feature on overcoming nonperforming loan (NPL) market failures with transaction platforms. This feature is part of the financial stability review of November 2017.
The special feature outlines the desirable features of NPL transaction platforms and discusses their operational implementation. The feature argues that an NPL transaction platform could help overcome the sources of market failure and induce new investors to enter the market. One of the main functions of an NPL transaction platform can be to mitigate the information asymmetry between potential investors and banks willing to sell NPLs. An NPL platform can substantially lower the costs of investor due diligence by standardizing loan data tapes and allowing a wide pool of interested investors to access them. An NPL transaction platform could also play a role in promoting securitization as a tool in NPL resolution and could facilitate divestment by national asset management companies.
Moreover, the EU Council and ESRB have recently stated the potential usefulness of NPL platforms, as they can form part of the comprehensive solution to the euro area NPL problem. The role of the authorities may be limited to the regulatory amendments needed to facilitate the operation of such a platform. Platforms may be potentially useful for a range of asset classes and participation should be open to all interested holders of and investors in NPLs. The feature also highlights that, to realize its full potential benefits, the platform would need to be supported by structural changes aimed at expanding the NPL investor base, such as relaxing licensing requirements and fostering the growth of independent loan servicing.
Related Link: Special Feature on NPLs (PDF)
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.
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.
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.
FASB announced the launch of its new Post-Implementation Review (PIR) web portal.
EBA revised the draft implementing technical standards on supervisory reporting as part of the reporting framework 3.0.
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.
BoE updated the known issues document for the statistical reporting Forms AS and FV.
FED announced individual capital requirements for 34 large banks and these requirements go into effect on October 01, 2020.
SRB published a set of documents to give operational guidance to banks on implementation of the bail-in tool.
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.