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 Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
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.
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.
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.
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.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
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.
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.
The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.
The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.