SRB Outlines Potential Relief Measures to Mitigate Impact of COVID
SRB Chair Elke König issued a letter to banks outlining the potential operational relief measures related to COVID-19 outbreak. In an article, she further highlights that SRB, together with the national resolution authorities, will postpone less urgent information or data requests related to the upcoming 2020 resolution planning cycle. However, the letter highlights that the Liability Data Report, the Additional Liability Report, and the Minimum Requirement for own funds and Eligible Liabilities (MREL) quarterly template are essential reports and are expected to be delivered on time by banks. SRB will also take note of the measures adopted by authorities to provide capital relief to banks in support of the economy. This will be reflected in the future MREL decisions of SRB.
In addition, SRB continues to carefully monitor the market conditions and will assess the potential impact on transition periods needed for the build-up of MREL. The letter highlights that SRB will carefully monitor market conditions in the next months and analyze the potential impact on transition periods needed for the build-up of MREL. SRB is ready to use its discretion and the flexibility given by the regulatory framework to adapt transition periods and interim targets applied to banking groups as well as to adjust MREL targets in line with capital requirements, with particular reference to capital buffers. SRB will assess possible leeway in submission dates for other reports, such as those related to Critical Functions and Access to financial market infrastructures. SRB will continue its work on resolution planning and the preparation for issuing 2020 MREL decisions according to the set deadlines in early 2021.
The letter encourages banks to stay in close contact with internal resolution teams. In light of the challenges posed by resource constraints and adverse market conditions, the internal resolution teams will assess difficulties in achieving work program updates and in submitting other deliverables on an individual basis. Needless to say, all banks are expected to substantiate their requests and identify mitigating actions to continue progress toward resolvability. SRB supports the steps that ECB, Single Supervisory Mechanism, and national competent authorities are taking to help banks deliver their services and to keep lending. The resolution framework and the build-up of MREL will be important tools to help support the economic recovery and a strong banking sector.
Related Links
Keywords: Europe, Banking, MREL, Capital Requirements, Internal Resolution Teams, Liability Data Report, Resolution Framework, Elke Konig, COVID-19, Reporting, SRB
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
FED Releases DFAST Methodology and FR Y-14 Forms and InstructionsRelated Articles
ESAs Issue Multiple Regulatory Updates for Financial Sector Entities
The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.
ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments
The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.
IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets
The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.
EBA Finalizes Methodology for Stress Tests, Issues Other Updates
The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups
OSFI Sets Out Work Priorities and Reporting Updates for Banks
The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.
APRA Finalizes Changes to Capital Framework, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.
BIS Hub and Central Banks Conduct CBDC and DeFI Pilots
The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.
ECB Sets Deadline for Banks to Meet Its Climate Risk Expectations
The European Central Bank (ECB) published the results of its thematic review, which shows that banks are still far from adequately managing climate and environmental risks.
ESAs, ECB, & EC Issue Multiple Regulatory Updates for Financial Sector
Among its recent publications, the European Banking Authority (EBA) published the final standards and guidelines on interest rate risk arising from non-trading book activities (IRRBB)
EC Adopts Final Rules Under CRR, BRRD, and Crowdfunding Regulation
The European Commission (EC) recently adopted regulations with respect to the calculation of own funds requirements for market risk, the prudential treatment of global systemically important institutions (G-SIIs)
