EC Welcomes Agreement on Rules on Secondary Market for NPLs
EC welcomes the political agreement between the European Parliament and the Council on the proposal for a Directive on credit servicers and credit purchasers. The agreement concerns rules related to the secondary market for non-performing loans (NPLs) while the remaining part of the proposed work is underway in the European Parliament; this part seeks to facilitate the recovery of collateral from businesses to increase their chances of obtaining credit.
One of the key objectives of the Directive on credit servicers and credit purchasers, which was adopted in 2018, is to improve the access and transparency of secondary markets for NPLs. The Directive creates common reporting requirements for credit purchasers and an obligation to appoint a credit servicer for consumers and third-country investors. In this way, the new rules will create a Single Market for credit purchasers and credit servicers. This will foster competition, raise the average sale price of NPLs, and significantly reduce servicing costs for the benefit of borrowers. In addition, the Directive amends the Consumer Credit Directive and Mortgage Credit Directive. These amendments ensure that consumers will benefit from forbearance measures, are duly informed when the credit is transferred, and are able to keep the same contractual rights they had with the credit originators.
Related Links
Keywords: Europe, EU, Banking, NPLs, Credit Risk, European Parliament, European Council, Secondary Market for NPLs, EC
Previous Article
EBA Updates List of Risk Indicators and Risk Analysis ToolsRelated Articles
ESAs Issue Multiple Regulatory Updates for Financial Sector Entities
The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.
ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments
The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.
IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets
The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.
EBA Finalizes Methodology for Stress Tests, Issues Other Updates
The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups
OSFI Sets Out Work Priorities and Reporting Updates for Banks
The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.
APRA Finalizes Changes to Capital Framework, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.
BIS Hub and Central Banks Conduct CBDC and DeFI Pilots
The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.
ECB Sets Deadline for Banks to Meet Its Climate Risk Expectations
The European Central Bank (ECB) published the results of its thematic review, which shows that banks are still far from adequately managing climate and environmental risks.
ESAs, ECB, & EC Issue Multiple Regulatory Updates for Financial Sector
Among its recent publications, the European Banking Authority (EBA) published the final standards and guidelines on interest rate risk arising from non-trading book activities (IRRBB)
EC Adopts Final Rules Under CRR, BRRD, and Crowdfunding Regulation
The European Commission (EC) recently adopted regulations with respect to the calculation of own funds requirements for market risk, the prudential treatment of global systemically important institutions (G-SIIs)
