EBA Supports Harmonization of Creditworthiness Assessment Process
EBA responded to the EC consultation on the proposed new consumer agenda to express support for harmonization of the creditworthiness assessment process for consumer lending across EU; this includes the introduction of standards for the data and creditworthiness assessment process. The EBA response focuses on the revision of the Consumer Credit Directive (CCD or Directive 2008/48/EC) and builds on the recent EBA guidelines on loan origination and monitoring.
In its response, EBA calls for the introduction of binding principles on responsible lending such as an obligation to take into account target consumer interests, objectives, and characteristics when designing credit products. The response aims at reinforcing the requirements, for assessing the creditworthiness of borrowers, that are set out in the guideless and, thus, contributing to the EC’s planned changes to the CCD. In June 2020, EC had consulted on the new consumer agenda that, among other topics, contained a number of questions regarding the CCD. The questions also contained a series of proposals regarding the harmonization of the creditworthiness assessment of a borrower, which is a topic that EBA has addressed in the guidelines on loan origination and monitoring (EBA/GL/2020/06).
Related Links
Keywords: Europe, EU, Banking, Credit Assessment, Consumer Credit, Consumer Credit Directive, Loan Origination, Credit Risk, EBA, EC
Related Articles
APRA Decides to Standardize Submission Date for Quarterly Reporting
APRA announced the standardization of quarterly reporting due dates for authorized deposit-taking institutions.
Bundesbank Publishes Supporting Documentation for Reporting by Banks
Bundesbank published a list of "EntryPoints" that are accepted in its reporting system; the list provides taxonomy version and name of the module against each EntryPoint.
ECB Working Group Publishes Recommendations on EURIBOR Fallbacks
The private sector working group of ECB on euro risk-free rates published the recommendations to address events that would trigger fallbacks in the Euro Interbank Offered Rate (EURIBOR)-related contracts, along with the €STR-based EURIBOR fallback rates (rates that could be used if a fallback is triggered).
EBA Publishes Phase 1 of Reporting Framework 3.1
EBA published the phase 1 of its reporting framework 3.1, with the technical package covering the new reporting requirements for investment firms (under the implementing technical standards on investment firms reporting).
APRA to Finalize Capital Adequacy Standard Revisions by January 2022
Asia Pacific Australia Banking APS 111 Capital Adequacy Regulatory Capital Basel RBNZ APRA
ESMA Issues Guidelines on Outsourcing to Cloud Service Providers
ESMA published the final guidelines on outsourcing to cloud service providers.
EBA Publishes Data on Deposit Guarantee Schemes
EBA published annual data for two key concepts and indicators in the Deposit Guarantee Schemes (DGS) Directive—available financial means and covered deposits.
OSFI Sets Out Plan for Future Guidance on Managing Technology Risk
OSFI has set out the schedule for release of draft guidance on the management of technology risks by federally regulated financial institutions and private pension plans.
MAS Updates Housing Loan Rules, Proposes Corporate Governance Guidance
MAS updated rules for new housing loans by banks and finance companies.
HKMA Publishes Guideline on Sustainable Finance Grant Scheme
HKMA published a statement on the 100% Personal Loan Guarantee Scheme and a guideline on the Green and Sustainable Finance Grant Scheme (GSF Grant Scheme) as announced in the 2021-22 Budget.
