Featured Product

    ESMA Consults on Guide to Internal Controls for Credit Rating Agencies

    December 05, 2019

    ESMA launched a consultation on the guidelines on internal controls for credit rating agencies (CRAs). The guidelines set out the systems and controls that CRAs should have in place to meet the requirements of the CRA Regulation on internal controls. The consultation closes on March 16, 2020. ESMA will consider the responses it receives to this consultation paper in the first quarter of 2020 and expects to publish a final report by the third quarter of 2020.

    The CRA Regulation includes a number of requirements for the internal control system that a CRA must have in place to prevent or mitigate any possible conflicts of interest that may impact the independence of its credit rating activities. The proposed guidelines set out the views of ESMA on the components and characteristics that CRAs should have in place to demonstrate the presence of an effective framework for internal controls and effective internal control functions. The Internal Controls Framework focuses on the control environment, risk management, control activities, information and communications, and monitoring activities of a CRA. However, the Internal Controls Functions focus on specific roles, namely compliance, review, risk management, information security, and internal audit. These guidelines have been developed with a view to accommodate the proportionality that is provided for smaller CRAs under the CRA Regulation. The need for guidance on internal controls was identified during the supervisory work of ESMA in 2017 and 2018 and its development was highlighted as part of its 2019 Supervisory Work Program.

     

    Related Links

    Comment Due Date: March 16, 2020

    Keywords: Europe, EU, Banking, Insurance, Securities, CRAs, Internal Control Functions, Guideline, CRA Regulation, ESMA

    Related Articles
    News

    EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models

    The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.

    June 21, 2022 WebPage Regulatory News
    News

    EP Reaches Agreement on Corporate Sustainability Reporting Directive

    The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).

    June 21, 2022 WebPage Regulatory News
    News

    PRA Consults on Model Risk Management Principles for Banks

    The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.

    June 21, 2022 WebPage Regulatory News
    News

    EC Regulation Amends Standards for Calculating Credit Risk Adjustments

    The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    June 21, 2022 WebPage Regulatory News
    News

    BIS Hub Updates Work Program for 2022, Announces New Projects

    The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.

    June 17, 2022 WebPage Regulatory News
    News

    EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance

    The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.

    June 17, 2022 WebPage Regulatory News
    News

    US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule

    Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)

    June 16, 2022 WebPage Regulatory News
    News

    EIOPA Consults on Review of Securitization Framework in Solvency II

    The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.

    June 16, 2022 WebPage Regulatory News
    News

    UK Authorities Issue Regulatory and Reporting Updates for Banks

    The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.

    June 15, 2022 WebPage Regulatory News
    News

    BCBS Issues Climate Risk Principles while HKMA Expresses Its Support

    The Basel Committee on Banking Supervision (BCBS) issued principles for the effective management and supervision of climate-related financial risks.

    June 15, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8280