The European Banking Authority (EBA) published a report that sets out the implementing technical standards to amend Regulation 2016/1801 on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs) for securitization positions. EBA also updated the guidelines for assessing equivalence of professional secrecy and confidentiality regimes of third-country authorities.
The report with the revised final draft implementing technical standards on mapping of ECAIs addresses the relevant amendments introduced by the new securitization framework as well as the mappings for three ECAIs that extended their credit assessments to cover securitizations. The Implementing Regulation 2016/1801 is part of the European Union Single Rulebook for banking aimed at creating a safe and sound regulatory framework consistently applicable across the European Union. The Capital Requirements Regulation (CRR) amendments that were brought by the new securitization framework have made it necessary to update the mapping tables accordingly. Following the amendments to Chapter 5 of the CRR, a hierarchy of approaches was set out to calculate capital requirements for positions in a securitization, whereby institutions using the Securitization External Ratings Based Approach (SEC-ERBA) shall calculate risk-weighted exposure amounts based on credit quality steps (CQSs) set out in the CRR. The amended Regulation reflects 18 CQSs for long-term external credit assessments, which ensures enhanced granularity and risk-sensitivity with respect to the approaches previously considered in the Regulation. In addition, EBA published the individual draft mapping reports to illustrate how the methodology was applied to produce the mappings. The final implementing technical standards will be submitted to the European Commission for endorsement before being published and will come into effect after 20 days of their publication in the Official Journal of the European Union.
The updated guidelines on equivalence assessment of third-country authorities are aimed to widen the scope and purpose of the assessment. The updated guidelines allow for a wider scope of the assessment to include all relevant provisions in the Capital Requirements Directive (CRD), the revised Payment Services Directive (PSD2), the Bank Recovery and Resolution Directive (BRRD), and the Anti-Money Laundering Directive (AMLD), as applicable to the specific third-country authorities. they also widen the purpose of assessment to support cooperation arrangements and facilitate participation in supervisory, resolution, and AML colleges. EBA performs this assessment to facilitate cooperation with third-country authorities as well as to facilitate the functioning of European Union supervisory and resolution colleges. EBA also updated the document showing how the principles that govern the European Union confidentiality regime are reflected in the European Union framework, as defined by the relevant provisions in the CRD, BRRD, AMLD, and PSD2. The competent authorities must comply with the guidelines two months after the publication of the guideline translations.
- Press Release on ECAI Mapping
- Standards on ECAI Mapping (PDF)
- Press Release on Confidentiality Regime
- Guidelines on Confidentiality Regime (PDF)
- Confidentiality Assessment Principles (PDF)
Effective Date: OJ+20 days
Keywords: Europe, EU, Banking, Implementing Technical Standards, ECAIs, CRR, Credit Quality Steps, Securitization, Basel, Regulatory Capital, CRD, Equivalence Regime, Credit Risk, Third Country Regime, EBA
Previous ArticleBCBS to Intensify Supervisory Focus on Machine Learning Models
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.
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.
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.
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
The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.
The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.
The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.
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.
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)
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)