EC adopted the work program for 2021. The work program contains new legislative initiatives across the six headline ambitions of President von der Leyen's Political Guidelines, including initiatives to achieve a climate-neutral Europe by 2050 and to put forward a roadmap of clearly defined 2030 digital targets, with focus areas including cybersecurity and data aspects of artificial intelligence. The Annexes to work program include lists of the new policy and legislative initiatives, the Regulatory Fitness and Performance program (REFIT) initiatives to simplify existing regulation, the priority pending proposals, and the intended withdrawals of pending proposals for the financial sector.
In the work program, the new initiatives for the financial sector in EU mainly relate to the:
- Completion of the Banking Union through the revision of the bank crisis management and deposit insurance framework (legislative, incl. impact assessment, Article 114 TFEU, Q4 2021).
- Completion of the Capital Markets Union through the investment protection and facilitation framework (legislative, incl. impact assessment, Article 114 TFEU, Q2 2021), revision of prudential rules for insurance and reinsurance companies (Solvency II) (legislative, incl. impact assessment, Articles 53(1), 62 and 114 TFEU, Q3 2021), and revision of the Markets in Financial Instruments Directive and Regulation (legislative, incl. impact assessment, Article 114 TFEU, Q4 2021).
- Mitigating climate change through sustainable corporate governance (legislative, incl. impact assessment, Articles 50 and, possibly, 114 TFEU, Q2 2021) and establishment of an EU green bond standard (legislative, incl. impact assessment, Article 114 TFEU, Q2 2021)
- Anti-money laundering through a legislative package (legislative, incl. impact assessment, Article 114 TFEU, Q1 2021)
In terms of pending initiatives, the priority proposals relevant for financial sector include the proposal for a regulation on:
- Regulation on digital operational resilience for the financial sector and amending Regulations (EC) No 1060/2009, (EU) No 648/2012, (EU) No 600/2014, and (EU) No 909/2014
- Regulation on pilot regime for market infrastructures based on distributed ledger technology
- Regulation on markets in crypto-assets and amending Directive (EU) 2019/1937
- Regulation amending Regulation (EU) 2016/1011 as regards the exemption of certain third-country foreign exchange benchmarks and the designation of replacement benchmarks for certain benchmarks in cessation
- Regulation amending Regulation (EU) No 575/2013 as regards adjustments to the securitization framework to support the economic recovery in response to the COVID-19 pandemic
- Regulation amending Regulation (EU) 2017/2402 laying down a general framework for securitization and creating a specific framework for simple, transparent and standardized securitization to help the recovery from the COVID-19 pandemic
- Regulation on credit servicers, credit purchasers, and the recovery of collateral
- Regulation amending Regulation (EU) 806/2014 to establish a European Deposit Insurance Scheme
Keywords: Europe, EU, Banking, Insurance, Securities, Climate Change Risk, ESG, Work Program, Basel, Solvency II, Regtech, EC
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The Australian Prudential Regulation Authority (APRA) has published the findings of its latest climate risk self-assessment survey conducted across the banking, insurance, and superannuation industries.
The French Prudential Supervisory Authority (ACPR) published a notice related to the methods for calculating and publishing prudential ratios under the Capital Requirements Directive (CRD IV) and the minimum requirement for own funds and eligible liabilities (MREL).
The Financial Stability Institute (FSI) of the Bank for International Settlements recently published a paper proposing a framework for classifying financial stability regulation as either entity-based or activity-based.
The European Insurance and Occupational Pension Authority (EIOPA) published the risk dashboard based on Solvency II data and the final version of the application guidance on climate change materiality assessments and climate change scenarios in the Own Risk and Solvency Assessment (ORSA).
The European Banking Authority (EBA) and the European Central Bank (ECB) published their responses to the consultations of the International Sustainability Standards Board (ISSB) and the European Financial Reporting Advisory Group (EFRAG) on sustainability-related disclosure standards.
A Consultative Group on Risk Management (CGRM) at the Bank for International Settlements (BIS) published a report that examines incorporation of climate risks into the international reserve management framework.
The European Banking Authority (EBA) published the final guidelines on liquidity requirements exemption for investment firms, updated version of its 5.2 filing rules document for supervisory reporting, and Single Rulebook Question and Answer (Q&A) updates in July 2022.
The European Insurance and Occupational Pensions Authority (EIOPA) published Version 2.8.0 of the Solvency II data point model (DPM) and XBRL taxonomy.
The European Union published, in the Official Journal of the European Union, an opinion from the European Economic and Social Committee (EESC); the opinion is on the proposal for a regulation to amend the Capital Requirements Regulation (CRR).
HM Treasury published a draft statutory instrument titled “The Financial Services (Miscellaneous Amendments) (EU Exit) Regulations 2022,” along with the related explanatory memorandum and impact assessment.