EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU. The public consultation addresses three EU legislative texts: Bank Recovery and Resolution Directive (BRRD), Single Resolution Mechanism Regulation (SRMR), and Deposit Guarantee Schemes Directive (DGSD). The possible revision of the resolution framework as well as a possible further harmonization of insolvency law are foreseen in the respective review clauses of the three legislative texts. By reviewing the framework, EC aims to increase its efficiency, proportionality, and overall coherence to manage bank crises in EU as well as to enhance the level of depositor protection, including through the creation of a common depositor protection mechanism in the banking union. The consultation is open until May 20, 2021.
This consultation covers 10 questions on the key directions of the review of the bank crisis management and deposit insurance frameworks. The questions raised in the consultation relate to the following aspects:
- Objectives of crisis management and deposit insurance frameworks
- Use of the tools and powers in BRRD
- Revision to the conditions to access different sources of funding in resolution and in insolvency
- Potential reform of the use of Deposit Guarantee Scheme funds in the future framework
- Issues related to depositor protection that would require clarification of the current rules and/or policy response
- Scope of depositor protection in the future framework
- European Deposit Insurance Scheme
Crisis management and deposit insurance, including a common funding scheme for the Banking Union, are strongly interlinked and interdependent and hold the potential for synergies, if developed jointly. In parallel to this consultation, EC is holding a targeted consultation, until April 20, 2021, which covers 41 questions that include the general questions and those addressing concrete technical features.
Comment Due Date: May 20, 2021
Keywords: Europe, EU, Banking, BRRD, SRMR, DGSD, Deposit Insurance, Resolution Framework, Banking Union, Proportionality, Crisis Management Framework, EC
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.
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.
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.