BaFin Issues Regulatory Updates for Banks in Germany
The Federal Financial Supervisory Authority of Germany (BaFin) published a circular on determination of the minimum requirement for own funds and eligible liabilities (MREL) for institutions and group companies, for which the wind-up plan provides for liquidation in the context of insolvency proceedings. This circular will replace the previous MREL circular that was published in August 2019. BaFin also launched a consultation (12/2021) on revisions to the circular on the minimum requirements for feasibility of a bail-in (MaBail-in). BaFin is consulting to extend the circular to institutions and group-affiliated companies for which the resolution plan does not provide for any resolution measures, provided they are part of a resolution group or relevant third-country subsidiaries. The consultation closes on August 18, 2021.
In addition, BaFin published amendments to the minimum requirements for risk management (MaRisk). The amendments to the minimum requirements for risk management implement the European Banking Authority (EBA) guidelines on management of non-performing and forborne exposures (EBA/GL/2018/06), outsourcing (EBA/GL/2019/02), and information and communication technology (ICT) and security risk management (EBA/GL/2019/04). A new version of the banking supervisory requirements for information technology (BAIT) was also released. In the amended BAIT, the supervisory authority describes what framework conditions they can now expect for secure information processing and information technology. Finally, BaFin published the payment service supervisory requirements for information technology (ZAIT), for payment and e-money institutions.
Related Links (in German)
- Press Release on MREL Circular
- MREL Circular
- Press Release on MaBail-In
- Consultation on MaBail-In
- Press Release on MaRisk, BAIT, and ZAIT
- Circular on MaRisk
- Circulars on BAIT
- Circular on ZAIT
Comment Due Date: August 18, 2021
Keywords: Europe, Germany, Banking, MREL, Bail-In, ICT Risk, Resolution Framework, Outsourcing, Technology Risk, NPLs, Forborne Exposures, EBA, BaFin
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