ECB Opinion on Proposed Directive and Regulation on Covered Bonds
ECB published its opinion (CON/2018/37) on the proposed directive and regulation on covered bonds. In its opinion, ECB welcomed the objectives of the proposed directive and regulation of promoting further integration of Union financial markets and deepening the Capital Markets Union. ECB is in favor of a developed, harmonized, high-quality, and transparent covered bond market in the Union and sees the proposed directive as an important step toward creating such a market.
ECB opines that it also sees merit in the proposed directive serving as a basis for new national legislation on covered bonds. However, the implementation of the proposed directive might not lead to full harmonization to the extent that member states will have flexibility in its implementation. The provided degree of flexibility should not endanger the objective of further convergence toward a common, high standard in all member states. The distinction made between different product regulations within the initiatives launched under the broader policy objectives of the Capital Markets Union allows for product-specific considerations. In this context, ECB supports the approach of the proposed directive, whereby European secured notes would be dealt with in a separate legislative proposal. Furthermore, the proposed directive and regulation are independent of the Eurosystem collateral framework and the covered bond purchase program, or CBPP3, of the Eurosystem, as these are monetary policy instruments that fall within the exclusive competence of the Eurosystem.
This opinion was issued in response to the requests received by ECB. On March 28, 2018 and April 13, 2018, ECB had received requests from the Council of the European Union and the European Parliament respectively for an opinion on:
- A proposal for a directive of the European Parliament and of the Council on the issue of covered bonds and covered bond public supervision and amending Directive 2009/65/EC and Directive 2014/59/EU
- A proposal for a regulation of the European Parliament and of the Council on amending the Capital Requirements Regulation or Regulation (EU) No 575/2013 regarding exposures in the form of covered bonds
Related Links
Keywords: Europe, EU, Banking, Securities, Covered Bonds, CON/2018/37, CRR, Capital Markets Union, ECB
Related Articles
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
BIS Bulletin Examines Cognitive Limits of Large Language Models
The use cases of generative AI in the banking sector are evolving fast, with many institutions adopting the technology to enhance customer service and operational efficiency.
ECB is Conducting First Cyber Risk Stress Test for Banks
As part of the increasing regulatory focus on operational resilience, cyber risk stress testing is also becoming a crucial aspect of ensuring bank resilience in the face of cyber threats.
EBA Continues Momentum Toward Strengthening Prudential Rules for Banks
A few years down the road from the last global financial crisis, regulators are still issuing rules and monitoring banks to ensure that they comply with the regulations.
EU and UK Agencies Issue Updates on Final Basel III Rules
The European Commission (EC) recently issued an update informing that the European Council and the Parliament have endorsed the Banking Package implementing the final elements of Basel III standards