ESRB published a recommendation on the exchange and collection of information for macro-prudential purposes. This information is for the branches of credit institutions that have their head office in another member state or in a third country (ESRB/2019/18). The recommendations are related to the cooperation and exchange of information on a need-to-know basis, changes to the Union legal framework, and guidelines form and the monitoring of, the exchange of information.
Recommendation A on cooperation and exchange of information on a need-to-know basis. It is recommended that the relevant authorities exchange information deemed necessary for the discharge of their tasks related to the adoption and/or activation of macro-prudential policy measures or for other financial stability tasks, in an effective and efficient manner. It is also recommended that the relevant authorities establish memoranda of understanding or other forms of voluntary arrangements for cooperation and exchange of information among themselves—or with a relevant authority of a third country—where considered necessary and appropriate by all parties involved to facilitate the exchange of information.
Recommendation B on changes to the Union legal framework. It is recommended that EC assess whether any impediments exist in Union legislation, which prevent authorities entrusted with the adoption and/or activation of macro-prudential policy measures or with other financial stability tasks from having or obtaining the necessary information on branches to carry out those functions or fulfill those tasks. It is recommended that EC propose that Union legislation be amended to remove any such impediments, where EC concludes, as a result of its assessment, that such impediments exist.
Recommendation C on guidelines for and the monitoring of exchange of information. It is recommended that EBA issue guidelines in accordance with Recommendation A for the exchange of information between relevant authorities regarding branches of credit institutions having their head office in another member state, which should include a list of information to be exchanged, as a minimum, on a need-to-know basis, and within the limits of applicable Union and national laws. The list should include, as a minimum, information items from each of the following categories:
- At the branch level—Assets and exposures with breakdowns, breakdowns of assets regarding borrower-based measures, liabilities with breakdowns, intra-financial sector exposures, and information necessary to identify other systemically important institutions (O-SIIs)
- At the parent group or parent institution level—Own funds and leverage; funding and liquidity; and relevant information on branches, such as business strategy and certain elements of recovery plans of credit institutions and supervisory assessments that are relevant.
It is also recommended that EBA monitor on a regular basis, in cooperation with ESRB, the effectiveness and efficiency of the exchange of information between relevant authorities. By December 31, 2023, EBA is requested to deliver to ESRB and to the European Council a report on the implementation of Recommendation C.
Keywords: Europe, EU, Banking, Recommendation, ESRB 2019/18, Systemic Risk, Macro-Prudential Policy, Own Funds, Recovery Plans, EC, EBA
Across 35 years in banking, Blake has gained deep insights into the inner working of this sector. Over the last two decades, Blake has been an Operating Committee member, leading teams and executing strategies in Credit and Enterprise Risk as well as Line of Business. His focus over this time has been primarily Commercial/Corporate with particular emphasis on CRE. Blake has spent most of his career with large and mid-size banks. Blake joined Moody’s Analytics in 2021 after leading the transformation of the credit approval and reporting process at a $25 billion bank.
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