The International Swaps and Derivatives Association (ISDA) responded to the HM Treasury's (HMT) consultation on the Future Regulatory Framework in UK. In its response, ISDA makes several suggestions, which include that consolidated versions of rules should be made available post onshoring of European Union law and that the proposals for changes to legislation should include full marked-up text. In another development, the Bank of England (BoE) and the Financial Conduct Authority (FCA) published an update on the progress of the joint program to transform data collection from the financial sector; the communication highlights that the authorities are looking for about 20 FTEs from firms to be part of the core delivery team. Finally, BoE launched the second round of the Biennial Exploratory Scenario (BES) exercise on financial risks from climate change. The second round of the BES will comprise a small number of questions, which will further explore the strategic responses of participants to the three scenarios published as part of the first round and the associated implications for their business models.
The Climate BES exercise comprised the three main objectives: size financial exposures to climate risks, understand challenges to participants' business models, and assist participants to enhance their climate risk management. This second round will focus on understanding the challenges to participants’ business models and gauging their likely responses; focus will be on the participants’ proposed management actions in response to climate scenarios. The second round will comprise a small number of questions, which will further explore the strategic responses of participants to the three scenarios published as part of the first round and the associated implications for their business models. Participants will not be required to update the quantitative loss projections they provided as part of the first round of the exercise. All Climate BES participants are taking part in the second round. The submissions for the second round end on March 31, 2022, with BoE expecting to publish the results of the Climate BES in May 2022.
- ISDA Response to HM Treasury Proposal (PDF)
- Communication on Data Transformation
- News Release on Climate Risk Exercise
- Details on Second Round of BES
Keywords: Europe, UK, Banking, Securities, Credit Risk, Data Collection, Reporting, Regtech, Data Transformation, CRE, FCA, BoE, CBES, Stress Testing, ESG, Climate Change Risk, ISDA, Scenario Analysis, HM Treasury, Subheadline
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.
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.
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.
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
The Swiss Federal Council recently decided to further develop the Swiss Climate Scores, which it had first launched in June 2022.
The Basel Committee on Banking Supervision (BCBS) launched consultation on a Pillar 3 disclosure framework for climate-related financial risks, with the comment period ending on February 29, 2024.
The U.S. President Joe Biden signed an Executive Order, dated October 30, 2023, to ensure safe, secure, and trustworthy development and use of artificial intelligence (AI).
The Monetary Authority of Singapore (MAS) launched an integrated digital platform, Gprnt, also known as “Greenprint.”
The European Banking Authority (EBA) has published the final templates, and the associated guidance, for collecting climate-related data for the one-off Fit-for-55 climate risk scenario analysis.
The Network for Greening the Financial System (NGFS) published its latest set of long-term climate macro-financial scenarios (Phase IV) for assessing forward-looking climate risks.