Featured Product

    EU Amends CRD4 and CRD5 as Part of Capital Markets Recovery Package

    February 26, 2021

    EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis. The amendments to MiFID II are related to the information requirements, product governance, and position limits while amendments to CRD4 and 5 are related to the application of these directives to investment firms. To ensure a consistent application of the legal framework applicable to the investment firms set out in Article 67 of the Investment Firms Directive (IFD or Directive 2019/2034), the transposition deadline for CRD5 with respect to investment firms has been extended to June 26, 2021. Directive 2021/338 shall enter into force on the day following that of its publication in the Official Journal of the European Union.

    An amendment to CRD4 is specified in Article 3 of Directive 2021/338, which states that, for the purpose of identifying staff whose professional activities have a material impact on the institution’s risk profile as referred to in Article 92(3), except as regards staff in investment firms, EBA shall develop draft regulatory technical standards setting out the criteria to define the following:

    • Managerial responsibility and control functions;
    • Material business unit and significant impact on the relevant business unit’s risk profile; and 
    • Other categories of staff not expressly referred to in Article 92(3) whose professional activities have an impact on the institution’s risk profile comparably as material as that of those categories of staff referred to therein.

    Regarding the application of these regulatory technical standards to investment firms, the empowerment laid down in Article 94(2) of CRD4, as amended by CRD5, shall continue to apply until June 26, 2021. Furthermore, Article 4 (on transposition) of Directive 2021/338 specifies that member states shall adopt and publish by November 20, 2021 the laws, regulations, and administrative provisions necessary to comply with this Directive. They shall apply the measures from February 28, 2022. Member states shall communicate to EC the text of the main provisions of national law, which they adopt in the field covered by this Directive. By way of derogation from paragraph 1, the amendments to CRD4 and CRD5 shall apply from December 28, 2020. The amendments in Directive 2021/338 form a part of the changes proposed under the EU Capital Markets Recovery Package. 

     

    Related Links

    Effective Date: February 27, 2021

    Keywords: Europe, EU, Banking, Securities, Investment Firms, COVID-19, IFD, CRD5, CRD4, Basel, Remuneration Requirements, European Council, European Parliament

    Featured Experts
    Related Articles
    News

    APRA Penalizes Heritage Bank for Incorrect Reporting of Capital

    The Australian Prudential Regulation Authority (APRA) found that Heritage Bank Limited had incorrectly reported capital because of weaknesses in operational risk and compliance frameworks, although the bank did not breach minimum prudential capital ratios at any point and remains well-capitalized.

    November 29, 2021 WebPage Regulatory News
    News

    OSFI Releases Annual Report 2021-2022

    The Office of the Superintendent of Financial Institutions (OSFI) released the annual report for 2020-2021.

    November 29, 2021 WebPage Regulatory News
    News

    APRA Finalizes Capital Adequacy Standards for Banks

    The Australian Prudential Regulation Authority (APRA) published, along with a summary of its response to the consultation feedback, an information paper that summarizes the finalized capital framework that is in line with the internationally agreed Basel III requirements for banks.

    November 29, 2021 WebPage Regulatory News
    News

    CPMI-IOSCO Seek Comments on Access to Central Clearing and Portability

    The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) issued a consultative report focusing on access to central counterparty (CCP) clearing and client-position portability.

    November 29, 2021 WebPage Regulatory News
    News

    APRA Finalizes Guidance on Management of Climate Change Risks

    The Australian Prudential Regulation Authority (APRA) released the final Prudential Practice Guide on management of climate change financial risks (CPG 229) for banks, insurers, and superannuation trustees.

    November 26, 2021 WebPage Regulatory News
    News

    EBA Publishes Single Rulebook Q&A Updates in November 2021

    The European Banking Authority (EBA) Single Rulebook Question and Answer (Q&A) tool updates for this month include answers to 10 questions.

    November 26, 2021 WebPage Regulatory News
    News

    EC Finalizes Rules on Internal Approaches Benchmarking Exercise

    The European Commission, or EC, finalized the Implementing Regulation 2021/2017 with respect to the benchmark portfolios, reporting templates, and reporting instructions for the supervisory benchmarking of internal approaches for calculating own funds requirements.

    November 26, 2021 WebPage Regulatory News
    News

    EC Proposes New Measures Under Capital Markets Union Package

    The European Commission (EC) has adopted a package of measures related to the Capital Markets Union.

    November 25, 2021 WebPage Regulatory News
    News

    European Council Adopts Position on Digital Finance Package Proposals

    The European Council adopted its position on two proposals that are part of the digital finance package adopted by the European Commission in September 2020, with one of the proposals involving the regulation on markets in crypto-assets (MiCA) and the other involving the Digital Operational Resilience Act (DORA).

    November 25, 2021 WebPage Regulatory News
    News

    PRA Proposes Rulebook Changes; BoE Extends BEEDS Testing Window

    The Prudential Regulation Authority (PRA) is proposing, via the consultation paper CP21/21, to apply group provisions in the Operational Resilience Part of the PRA Rulebook (relevant for the Capital Requirements Regulation or CRR firms) to holding companies.

    November 25, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7740