Featured Product

    EBA Consults on Revised Guidelines on Recovery Plan Indicators

    March 18, 2021

    EBA proposed to revise the guidelines on recovery plan indicators, under the Bank Recovery and Resolution Directive (BRRD or Directive 2014/59/EU). To strengthen the quality of recovery indicators framework and contribute to the effective crisis preparedness of institutions, the revisions provide additional guidance on indicators’ calibration, monitoring, and breaches notifications. Most provisions of the existing guidelines remain unaltered, apart from replacing or adding a few metrics to the minimum list of recovery indicators and updating the format of the existing text to the legal template for EBA guidelines. The consultation period for the guidelines ends on June 18, 2021.

    EBA issued the existing guidelines in 2015 and is now amending these guidelines based on the practical experience acquired in recovery planning. As part of the proposed revisions, additional guidance has been provided to institutions on the general principles to follow in setting the thresholds of recovery plan indicators, focusing on the treatment of recovery indicators in crisis, particularly in case of application of supervisory relief measures. The revised guidelines clarify that, in the case of systemic crisis, there should not be automatic recalibration of recovery plan indicators due to supervisory relief measures, except in duly justified cases and unless agreed with the competent authority. The revised guidelines recognize the importance of timely notification of recovery indicators breaches and of frequent monitoring of indicators in a situation of crisis. One indicator—cost of wholesale funding—has been removed while three new recovery indicators have been added to the minimum list of recovery indicators—minimum requirements for own funds and eligible liabilities/total loss-absorbing capacity, asset encumbrance, and liquidity position. 

    The key objective of the recovery plan indicators is to help institutions monitor and respond to the emergence and evolution of stress. Thus, the revised guidelines provide a common EU standard for the recovery plan indicators to ensure they can promptly signal a stressed situation and enable an institution to consider timely and effective recovery actions. On publication of the final guidelines, the original guidelines on the minimum list of qualitative and quantitative recovery plan indicators will be repealed.

     

    Related Links

    Comment Due Date: June 18, 2021

    Keywords: Europe, EU, Banking, BRRD, Recovery Planning, MREL, TLAC, Basel, Resolution Framework, Asset Encumbrance, Liquidity Position, EBA

    Featured Experts
    Related Articles
    News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News
    News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News
    News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News
    News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News
    News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News
    News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News
    News

    EBA Updates Address Basel and NPL Requirements for Banks

    The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.

    December 22, 2022 WebPage Regulatory News
    News

    ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite

    The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.

    December 22, 2022 WebPage Regulatory News
    News

    FCA Sets up ESG Committee, Imposes Penalties, and Issues Other Updates

    The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.

    December 20, 2022 WebPage Regulatory News
    News

    FSB Reports Assess NBFI Sector and Progress on LIBOR Transition

    The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.

    December 20, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8697