EC Amends Regulation on Liquidity Coverage Requirements for Banks
EC published the text of the Commission Delegated Regulation on liquidity coverage requirement for credit institutions. This Regulation amends the Delegated Regulation (EU) 2015/61 to supplement the Capital Requirements Regulation or CRR (EU Regulation No 575/2013). The EC consultation on this regulation ended on February 21, 2018 and EC received 19 responses to the consultation. This Commission Delegated Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
The key changes relate to the following:
- Calculation of expected liquidity outflows and inflows on repurchase agreements, reverse repurchase agreements, and collateral swaps transactions with the international liquidity standard
- Treatment of certain reserves held with third-country central banks
- Waiver of the minimum issue size for certain non-EU liquid assets
- Application of the unwind mechanism for the calculation of the liquidity buffer
- Integration in the LCR Delegated Regulation of the new criteria for simple, transparent, and standardized securitizations
Given the limited amount of changes to the existing LCR Delegated Regulation, it is proposed to adopt the amendments to that Regulation rather than the whole new text. This would maintain the structure of the original LCR Delegated Regulation. In accordance with Article 462 of the CRR, EC remains empowered to review the Delegated Regulation for an indeterminate period of time.
Related Links
Effective Date: OJ+20 Days
Keywords: Europe, EU, Banking, LCR, CRR, Liquidity Risk, EC
Previous Article
SBIF Extends Consultation Period for Provisions of Credit RiskRelated Articles
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
BIS Bulletin Examines Cognitive Limits of Large Language Models
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.
ECB is Conducting First Cyber Risk Stress Test for Banks
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.
EBA Continues Momentum Toward Strengthening Prudential Rules for Banks
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.
EU and UK Agencies Issue Updates on Final Basel III Rules
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