Featured Product

    ESRB Report on Macroprudential Policy Implications of Foreign Branches

    December 13, 2019

    ESRB published a report that explores macro-prudential policy implications for foreign branches relevant for financial stability. The report discusses the deficiencies in the current legal framework in EU with regard to the exchange and collection of macro-prudential information on foreign bank branches. It discusses the importance of such information exchange from a financial stability perspective and proposes that a framework for the exchange of information on foreign branches for macro-prudential purposes should be further developed at the EU and national levels.

    The role of foreign branches in financial intermediation may gradually increase in parallel with the process of financial integration and further progress in the Banking Union. The report discusses the financial stability implications of foreign branches and analyzes the EU legal framework for the exchange and collection of information for macro-prudential purposes. It describes how significant foreign branches are in EU member states and discusses their potential financial stability implications. It then describes the current situation regarding existing definitions, information available, and the framework for the exchange of information on foreign branches within the overall EU legal framework. It also discusses new avenues for requiring and exchanging information on foreign branches. Finally, the report concludes that a framework for the exchange of information on foreign branches for macro-prudential purposes is necessary and should be further developed at the EU and national levels. It also proposes, as the vehicles of this framework, the colleges of supervisors and voluntary arrangements between authorities on the exchange of information within the existing legal framework, such as Memoranda of Understanding.

    The report specifies that relevant authorities entrusted with the adoption and/or activation of macro-prudential policy measures or other financial stability tasks could be granted access to information on foreign branches through a voluntary exchange of information based on a mutual agreement between authorities. Well-designed and efficient information-sharing arrangements on foreign branches can facilitate the tasks of host authorities entrusted with the adoption and/or activation of macro-prudential policy measures or other financial stability tasks in several fields, including in the areas of risk analysis, reciprocity, and supervision of measures. The Nordic-Baltic Macroprudential Forum (NBMF), along with the existing Memorandum of Understanding for financial stability in the Nordic-Baltic region, could be considered as a benchmark for a close regional cooperation between macro-prudential authorities.The Memorandum of Understanding on supervision of significant branches in the Nordic-Baltic region provides an example of the development of a coordination framework intended to facilitate cooperation between competent authorities in the region.

     

    Related Link: Report (PDF)

    Keywords: Europe, EU, Banking, Systemic Risk, Macro-prudential Policy, Foreign Bank Branches, Financial Stability, Supervisory Cooperation, ESRB

    Featured Experts
    Related Articles
    News

    EBA Proposes Standards for IRRBB Reporting Under Basel Framework

    The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.

    January 31, 2023 WebPage Regulatory News
    News

    FED Issues Further Details on Pilot Climate Scenario Analysis Exercise

    The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.

    January 17, 2023 WebPage Regulatory News
    News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News
    News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News
    News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News
    News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News
    News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News
    News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News
    News

    EBA Updates Address Basel and NPL Requirements for Banks

    The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.

    December 22, 2022 WebPage Regulatory News
    News

    ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite

    The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.

    December 22, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8699