EMEA Centre for Regulatory Strategy in Financial Services UK

EU Benchmark Regulation: Our Translation, your Transition and the Timeframe

EU Benchmark Regulation

Read the Original Blog Here

The European Commission’s Regulation on indices used as financial benchmarks in financial instruments and financial contracts (the Regulation) goes live on 1 January 2018. It forms part of the EU’s response to a series of high profile investigations in recent years into the alleged manipulation of key financial benchmarks, including LIBOR. These investigations raised concerns over the reliability and integrity of financial benchmarks, which underpin transactions worth trillions of dollars. The Regulation aims to reduce the risk of manipulation, bolster the reliability of benchmarks administered and ultimately provide a safer environment for the use of benchmarks in the EU.

As the countdown to the Regulation begins, we examine some key considerations for firms in the upcoming weeks and months.

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Posted on 17/11/2017 | 0 Comments

PSD2 | Are firms ready?

PSD2

Two months from today, on 13 January, the revised Payment Services Directive (PSD2)1 will come into effect across the European Union (EU). To understand how prepared the industry is for this deadline Deloitte surveyed over 70 firms across 18 European countries, between August and September, to gather their views.

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Posted on 13/11/2017 | 0 Comments

Open Banking | Disruption is afoot for regulators as well as banks

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The much anticipated “Open Banking” revolution will start in 2018 and will have profound implications for the retail banking sector. But what is perhaps less commonly acknowledged is that Open Banking has the potential to disrupt its own architects too. As the dynamics in retail banking change as a result of new products and services made possible by Open Banking, regulators too may need to rethink the way they operate and how they should redesign themselves to remain fit for the future.

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Posted on 07/11/2017 | 0 Comments

The impact of IFRS 9 on capital and regulatory reporting

The impact of IFRS 9

Background

Regulatory reporting and disclosure requirements will change significantly for firms under IFRS 9 as highlighted by recent European Banking Authority (EBA) and Prudential Regulatory Authority (PRA) publications.

IFRS 9 determines how firms should classify and measure financial assets and liabilities for accounting purposes and includes three main areas: Classification & Measurement, Impairment and Hedge Accounting rules. These accounting changes are reflected in regulatory reporting across FINREP, COREP and Pillar 3 disclosures, where some of the first results will be observed.

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Posted on 06/11/2017 | 0 Comments

Building Society risk governance arrangements – A case of blurred lines?

Risk management challenge

This blog is part of a series of insights on Building Society risk management.

An area that is continually subject to debate and focus within Building Society Board’s is the effectiveness of the risk governance arrangements established within their firms. The vast majority of Building Societies (if not all) within the sector employ a traditional three lines of defence model as part of their risk governance and management structure. Whilst many societies can point to their structure as evidence of the three lines of defence, the Prudential Regulation Authority (‘PRA’) has increasingly challenged Boards and Senior Management as to how they are satisfied that this approach is implemented and that it operates in both an appropriate and acceptable manner.

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Posted on 01/11/2017 | 0 Comments

Root Cause Analysis (RCA) | Improving complaint categorisation

Root Cause Analysis (RCA)  improving complaint categorisation

This is the first in a series of blogs in which I will share some of my thoughts about good complaint RCA practices observed in the course of our work across a wide range of firms.

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Posted on 31/10/2017 | 0 Comments

A New Regulatory Capital Regime for MiFID Investment Firms - EBA’s Final Recommendations

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The European Banking Authority (EBA) has published its proposal for a new prudential framework for MiFID investment firms. The recommendations have been submitted to the European Commission (‘the Commission’), which is expected to propose legislation by the end of the year. Industry does not anticipate implementation to occur before 2020.

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Posted on 20/10/2017 | 0 Comments

Insurance Capital Standard (ICS) – Where do we stand on the eve of the IAIS annual conference?

ICS Graph

On 2nd November, insurance supervisors from across the world will converge on Kuala Lumpur for an annual conference that will take stock of progress in establishing a global capital standard for insurers dubbed the ‘Insurance Capital Standard Version 1.0’. On the eve of this conference, this blog analyses progress in the discussions to date and the key issues that remain outstanding and could yet hinder an agreement.1

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Posted on 18/10/2017 | 0 Comments

A New European System of Financial Supervision: European Commission proposes changes to the powers, governance and funding of the ESAs

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The European Commission has proposed a legislative package that is intended to increase substantially the powers of the three European Supervisory Authorities (ESAs)1 and to replace the funding currently provided by national competent authorities (NCAs) with direct funding by firms.

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Posted on 09/10/2017 | 0 Comments

The Building Society Risk Function – How effective is yours?

Risk management challenge

This blog is part of a series of insights on Building Society risk management.

One of the key focus areas of regulatory reviews performed over the last 18 months has been the effectiveness of the Risk Function. As part of the feedback issued to Building Societies following their supervisory review and evaluation process, the Prudential Regulation Authority (‘PRA’) has emphasised that it considers an effective Risk Function to be crucial to the future well-being of societies and the successful delivery of their business strategies.

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Posted on 02/10/2017 | 0 Comments