EC published Regulation 2021/1118 that supplements Bank Recovery and Resolution Directive (BRRD) with regard to the regulatory technical standards specifying the methodology to be used by resolution authorities to estimate the requirement referred to in Article 104a of the Capital Requirements Directive (CRD) IV. Regulation 2021/1118 also includes technical standards on the methodology for estimation of combined buffer requirement for resolution entities at the resolution group consolidated level, where the resolution group is not subject to those requirements under BRRD. Regulation 2021/1118 shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
Where a resolution entity has not been subject to an additional own funds requirement at the resolution group consolidated level, resolution authorities shall estimate that requirement in accordance with Article 1 of Regulation 2021/1118 for determining the minimum requirement for own funds and eligible liabilities (MREL) of the resolution entity at the resolution group consolidated level. The Regulation 2021/1118 includes provisions for adjustments for the estimation of the additional own funds requirement. Additionally, the estimation of the combined buffer requirement of the resolution entity at the resolution group consolidated level shall be the sum of the capital conservation, global systemically important institution, other systemically important institution, and systemic risk buffer requirements referred to in CRD IV, as applicable.
EC also published Regulation 2021/1122, which amends the Implementing Regulation 2016/1368 establishing a list of critical benchmarks used in financial markets pursuant to the Benchmarks Regulation (2016/1011). Regulation 2021/1122 is adding the Norwegian Interbank Offered Rate (NIBOR) to the list of critical benchmarks as well as removing the London Interbank Offered Rate (LIBOR) from the list. The Annex to Regulation 2021/1122 lists Euro Interbank Offered Rate (EURIBOR), Euro Overnight Index Average (EONIA), Stockholm Interbank Offered Rate, Warsaw Interbank Offered Rate, and NIBOR as critical benchmarks pursuant to the Benchmarks Regulation. Regulation 2021/1122 shall enter into force on the day following that of its publication in the Official Journal of the European Union.
Effective Date: July 28, 2021 (Regulation 2021/1118)/July 10, 2021 (Regulation 2021/1122)
Keywords: Europe, EU, Banking, Securities, MREL, BRRD, Resolution Framework, Basel, Regulatory Technical Standards, Systemic Risk, Regulatory Capital, Benchmarks Regulation, NIBOR, Norway, LIBOR, CRD, Benchmark Reforms, EC
Across 35 years in banking, Blake has gained deep insights into the inner working of this sector. Over the last two decades, Blake has been an Operating Committee member, leading teams and executing strategies in Credit and Enterprise Risk as well as Line of Business. His focus over this time has been primarily Commercial/Corporate with particular emphasis on CRE. Blake has spent most of his career with large and mid-size banks. Blake joined Moody’s Analytics in 2021 after leading the transformation of the credit approval and reporting process at a $25 billion bank.
Previous ArticleECB Designates Four Banks as Significant Institutions
A Consultative Group on Risk Management (CGRM) at the Bank for International Settlements (BIS) published a report that examines incorporation of climate risks into the international reserve management framework.
The European Banking Authority (EBA) published a report that examines the use of certain exemptions included in the large exposures regime under the Capital Requirements Regulation (CRR).
The Bank of England (BoE) issued a communication to firms to provide an update on the progress of the joint data transformation program—which is being led by BoE, the Financial Conduct Authority (FCA), and the industry—for the financial sector in UK.
The European Banking Authority (EBA) published the draft methodology, templates, and template guidance for the European Union-wide stress test in 2023.
The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) jointly published the final guidelines on common procedures and methodologies for the supervisory review and evaluation process (SREP) for investment firms.
The Prudential Regulatory Authority (PRA) proposed expectations, via CP8/22, in respect of changes to the instruments or claims that comprise unvested deferred sums awarded to material risk-takers as part of their variable pay.
The European Insurance and Occupational Pensions Authority (EIOPA) published Version 2.7.0 of the Solvency II data point model (DPM) and XBRL taxonomy.
The Office of the Superintendent of Financial Institutions (OSFI) updated the 2023 Basel Capital Adequacy Reporting (BCAR) manual as well as the 2023 BCAR return.
In a letter to the G20 Leaders, ahead of the July 2022 meeting, the Financial Stability Board (FSB) Chair set out an overview of the key work done by FSB.
The Single Resolution Board (SRB) published its resolvability assessment and "heat map" for 2021, updated the operational guidance on implementation of bail-in tool, and issued the annual report for 2021.