Tracker, Financial Services Regulation & Compliance - Banking


DOMESTIC:

Minister for Finance announces intention to proceed with an initial public offering of Allied Irish Banks

On 30 May 2017, the Minister for Finance announced his intention to float circa 25% of the Irish government's stake in Allied Irish Banks (AIB). The shares are to be listed on the Irish Stock Exchange and the London Stock Exchange. The Department of Finance announced that the AIB an initial public offering Prospectus and price range are expected to be published in mid-June.

Central Bank publishes Updated Notes on Compilation of AnaCredit Data Returns

The Central Bank has published updated notes on compilation for AnaCredit Data Returns aimed at assisting reporting agents in completing returns once the reporting requirements become effective. The updated guidance has incorporated guidance on credit and credit risk data returns as well as further minor updates.

European Union (Bank Recovery and Resolution) Resolution Fund Levy Regulations 2017, S.I. No. 162 of 2017, enters force

The European Union (Bank Recovery and Resolution) Regulations 2015 gave the Central Bank the authority to determine the aggregate annual target for contributions to the Bank and Investment Firm Resolution Fund. This Regulation sets out the levy rates that will be applicable to all institutions authorised in the State, as well as European Union branches operating in the State, in respect of the levy period 2017 to the Central Bank for the account of the Bank and Investment Firm Resolution Fund.

Department of Finance publishes the Fourth Progress Update Report on the Special Liquidation of Irish Bank Resolution Corporation

The report was prepared at the request of the Minister of Finance and outlines that the Irish Bank Resolution Corporation (IBRC) continue to adjudicate on claims received, with only 900 of the 3,000 claims received by IBRC remaining to be decided. Following the announcement in December 2016 that an interim dividend of 25% was to be paid to admitted unsecured creditors, IBRC indicated that will be catch-up payments on a quarterly basis as claims are adjudicated on.

Minister for Finance publishes the Asian Infrastructure Investment Bank Bill 2017

Following the acceptance of Ireland's application to join the Asian Infrastructure Investment Bank (AIIB), the Minister for Finance published the Bill, as required by the Constitution, in order to ratify the international agreement.

Central Bank publishes economic letter Volume 2017, Number 6 - "Macroprudential Measures and Irish Mortgage Lending: An Overview of Lending in 2016"

The letter provides an overview of residential mortgage lending in Ireland in 2016 based on loan level data reported to the Central Bank in compliance with loan-to-value (LTV) and loan-to-income (LTI) macroprudential Regulations. The data received in 2016 was the first full year of lending under the Regulations as they entered force on 9 February 2015.
 

EUROPEAN:

European Banking Authority publishes an Opinion on "own funds" in the context of the Capital Requirements Regulation (EU) 575/2013 and Capital Requirements Directive (EU) 2013/36 review proposal

Following the European Commission's proposal to amend the Capital Requirements Regulation (CRR) and Capital Requirements Directive (CRD) the EBA published an opinion, on aspects related to "own funds", focusing on the areas which they considered to be most significant, in particular: 

  • reinforcement of the EBA’s role in terms of Capital Equity Tier 1 (CET1) instruments; 
     
  • restrictions on distributions with regard to the Maximum Distributable Amount and its definition; and
     
  • reduction, redemption and repurchase of capital instruments, the introduction of an anti-circumvention principle and the introduction of a point of non-viability criterion.

European Banking Authority publishes list of Capital Instruments in EU Member States qualifying as CET1 Instruments and accompanying Report

The List is the fifth updated list of capital instruments that Member State competent authorities have classified as CET1 Instruments. The list is for the first time accompanied by a report, which includes additional information on the contents and objectives of the monitoring update as well as on the consequences of including or excluding instruments in, or from, the list.

European Banking Authority publishes Final draft Regulatory Technical Standards on valuation before, and after, resolution under the Banking Recovery and Resolution Directive

The Final Draft Regulatory Technical Standards (RTS) on valuation aim to provide independent valuers, when acting pursuant under the Banking Recovery and Resolution Directive (EU) 2014/59 (BRRD), with common criteria in order to determine valuations before, and after, a resolution occurs. The two sets of RTS will be submitted to the EU Commission for endorsement.

European Central Bank publishes Guidlines on Leveraged Transactions

The Guidelines focused on putting in place of risk management and governance structures for leveraged transactions, syndication activities, policies and procedures for new deal approval and monitoring and managing of longer-term leveraged transaction holdings, compliance and risk management functions for secondary market activities on leveraged transactions and reporting requirements.

The Guidlines enter into force six months after its publication and ECB set out that they will monitor leveraged lending activities and may ask selected banks to regularly report their exposures to leveraged transactions as well as the evolution and riskiness of these exposures.

European Central Bank publishes Guidance on Fit and Proper Assessments

The Guidelines covers fit and proper assessments of members of the management body, both in their management function and supervisory function of all institutions under the direct supervision of the ECB. The Guidelines aim to ensure a consistent application of the assessment criteria applicable to fit and proper assessments. This Guidelines are not a legally binding document and do not substitute the relevant legal requirements stemming either from applicable EU law or national law.

European Central Bank publishes Guidance Notes to reporting agents on Statistics on Holdings of Securities Regulation (EU) No 1011/2012 of the European Central Bank

Following the amendment of Regulation (EU) No 1011/2012, concerning Statistics on Holdings of Securities (SHS), the ECB has published guidance and more detailed information on the amending Regulation. The Regulation extended the list of reporting banking groups to cover all significant banking groups under direct ECB supervision and it has increased the attributes that are included in the data collection, in particular on accounting and risk related information. The first reporting deadline under the new requirements, to National Central Banks, will be the end of September 2018.

European Banking Authority publishes Consultation Paper on the scope of the draft Guidelines on Connected Clients under the CRR

The Consultation is seeking views on the possible extension of draft guidelines in relation to the definition of ‘group of connected clients’ in Article 4(1)(39) of the CRR. The draft guidelines originally applied only to the large exposures regime (part Four of the CRR) but now the EBA are considering extending the scope to the to the remaining aspects of the CRR, the EBA technical standards, and the EBA guidelines where the concept of group of connected client is relevant. The Consultation closes on 26 June 2017.

European Banking Authority publishes final Guidelines on the assessment of the Information and Communication Technology risk in the context of the Supervisory Review and Evaluation Process

The Guidelines, aimed at ensuring the convergence of supervisory practices when assessing Information and Communication Technology (ICT), are divided in three main parts; the general provisions for applying the Guidelines, the assessment of the institution's governance and strategy on ICT and the assessment of institutions' ICT risk exposures and controls. The Guidelines are intended to add to the previous EBA Guidelines on "common procedures and methodologies" for the Supervisory Review and Evaluation Process (SREP) and will apply from 1 January 2018.

Basel Committee on Banking Supervision publishes Frequently Asked Questions on Basel III monitoring

The FAQs were published to help institutions complete the Basel III monitoring questionnaire and in response to questions about the interpretation of certain aspects of the Basel III including capital, counterparty credit risk, the Basel III leverage ratio, the Liquidity Coverage Ratio (LCR) and the Net Stable Funding Ratio (NSFR).

European Commission and European Central Bank issue statement following the conclusion of the Seventh Post-Programme Surveillance Review Mission to Ireland

The Post-Programme Surveillance (PPS) Review Mission was carried out from 16 May to 19 May in order assess the countries capabilities to repay loans granted under the EU-IMF financial assistance programme. The PPS Review Mission found out that outlook for the Irish economy remains bright but that external risks, including the Brexit negotiations and possible future changes to international tax and trade policies, remain significant. The PPS Review also highlighted that residential property prices will need to be monitored moving forward.

Minister Eoghan Murphy, Minister of State for Financial Services, highlights Ireland's European Banking Authority bid at the Financial Markets Association's World Congress

Following the Minister for Finance offering Ireland as a location for the EBA once it leaves the United Kingdom in October 2016, Minster Murphy reiterated Ireland's interest and noted that he and other officials had been working to advance the case. The procedure for deciding the location of the EBA will be decided in June.

European Banking Authority publishes questions and answers in relation to the CRR (EU) No 575/2013 in the Single Rulebook Q&A on the following topics:

  • Own estimates of CCF in the retail exposure class;
     
  • Outflows associated with Payment Institutions' escrow accounts; Implementation of default definition - retail portfolio;
     
  • Market risk capital requirement for CIUs where a look-through approach is applied;
     
  • Valuation of immovable property performed by statistical model;
     
  • Definition of "managerial (internal business) purposes" in terms of re-developed IRB model application;
     
  • Article 422 and 460: Outflows associated with Payment Institutions' escrow accounts; and
     
  • AVA calculation and tax effects.

European Banking Authority publishes question and answer in relation to the CRD 2013/36/EU in the Single Rulebook Q&A on the following topic:

  • Specialised lending for the 'Low Default portfolios' Supervisory Benchmarking Exercise 2017.

For further information please contact a member of the Financial Regulation team.

Date published: 08 June 2017