SRB Outlines Upcoming Work Priorities, Issues MREL Dashboard
The Single Resolution Board (SRB) published the dashboard on minimum requirement for own funds and eligible liabilities (MREL), for the third quarter of 2021. The dashboard shows that shortfall against the 2024 final target reduced in the reporting period, with most banks either closing or reducing their shortfalls against the 2022 intermediate target. In a separate development, the SRB Chair discusses the key priorities for 2022, noting that SRB will continue to work with European partners on completing the Banking Union, including finding an institutional solution for liquidity in resolution, progressing on a common deposit guarantee system, and working on a European framework for bank insolvency.
The three key priorities or resolutions for 2022 involve:
- MREL build-up—Banks have been able to raise capital and debt instruments and build up further the necessary MREL buffers at record low interest rates. SRB will encourage all banks to continue to build up their MREL and fulfill requirements of the January 2022 intermediate MREL target and the 2024 final MREL target.
- Separability and reorganization plans—For mid-size banks, SRB is prioritizing the work on transfer tools, separability, and adjustments of MREL for such transfer tools. During 2021, SRB issued a guidance note on separability and plans to continue work on this area in 2022.
- Management information systems—SRB will prioritize the reorganization efforts of banks to become more efficient and customer-focused. Information technology and cyber risk management, will be a key priority, for banks to benefit from resolution planning and crisis preparedness.
In addition to these, a more transparent assessment of resolvability has long been a key priority for SRB. SRB has defined a heatmap as a tool to monitor, benchmark, and communicate the progress of banks toward full resolvability. SRB is evaluating the first cross-cutting assessment based on the progress made by banks so far in the form of such heatmap, and plans to publish an aggregated heatmap by the end of 2022.
Related Links
Keywords: Europe, EU, Banking, MREL, MREL Dashboard, Work Priorities, Basel, Regulatory Capital, Resolution Framework, Banking Union, Deposit Guarantee Mechanism, SRB
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
OCC Bulletin Sets Out Risk Management Principles for SBA LendingNext Article
EC Welcomes Adoption of Digital Services PackageRelated Articles
EBA Launches Stress Tests for Banks, Issues Other Updates
The European Banking Authority (EBA) launched the 2023 European Union (EU)-wide stress test, published annual reports on minimum requirement for own funds and eligible liabilities (MREL) and high earners with data as of December 2021.
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.
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.
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.
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.
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.
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.
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.
HKMA Publications Address Sustainability Issues in Financial Sector
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
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.
