FIN-FSA conducted, via a survey, a thematic review on the organization of depository activities. The survey was sent to all depositories that have the right to operate in Finland as a depository for a common fund or an alternative investment fund. The depositories were requested to provide information on the quality and scope of their depository activities, the organization of the depository activities, and the performance of supervisory duties. The thematic review did not address how the custody of the funds’ assets was arranged.
Twelve operators responded to the survey, five of which were branches of a foreign European economic area credit institution. The responses showed that the market for depository services is highly concentrated—only ten depositories provided depository services and the majority of assets was kept in custody by the three most significant agents. FIN-FSA wishes to point depositories’ attention to adequate personnel resources in supervisory duties and to the need of developing automated systems in order that the depositories have the genuine capacity to perform all of their statutory duties.
With respect to the duties reviewed, FIN-FSA was unable to ascertain that the depositories perform statutory supervision in all circumstances with a frequency required by fund-level risk assessment. The supervisory procedures observed by a depository must be based on a risk assessment conducted by the depository, which, in the view of FIN-FSA, should be documented, for example, in a supervision plan. Depositories must also note that ESMA has provided interpretations on the application of regulation on depositories.
Keywords: Europe, Finland, Banking, Securities, Depository, Thematic Review, Supervision, ESMA, FIN-FSA
Previous ArticleAPRA Issues Corrections to Prudential Standards for General Insurers
BIS published a paper that provides an overview on the use of big data and machine learning in the central bank community.
APRA finalized the reporting standard ARS 115.0 on capital adequacy with respect to the standardized measurement approach to operational risk for authorized deposit-taking institutions in Australia.
ECB published a guide that outlines the principles and methods for calculating the penalties for regulatory breaches of prudential requirements by banks.
MAS and The Association of Banks in Singapore (ABS) jointly issued a paper that sets out good practices for the management of operational and other risks stemming from new work arrangements adopted by financial institutions amid the COVID-19 pandemic.
ACPR announced that a new data collection application, called DLPP (Datalake for Prudential), for collecting banking and insurance prudential data will go into production on April 12, 2021.
BCB announced that the Financial Stability Committee decided to maintain the countercyclical capital buffer (CCyB) for Brazil at 0%, at least until the end of 2021.
EIOPA has launched a European-wide comparative study on non-life underwriting risk in internal models, also kicking-off of the data collection phase.
SRB published an overview of the resolution tools available in the Banking Union and their impact on a bank’s ability to maintain continuity of access to financial market infrastructure services in resolution.
EBA is consulting on the implementing technical standards for Pillar 3 disclosures on environmental, social, and governance (ESG) risks, as set out in requirements under Article 449a of the Capital Requirements Regulation (CRR).
ESAs Issue Advice on KPIs on Sustainability for Nonfinancial Reporting