EBF WEEKLY + FINANCIAL REGULATION AGENDA
for the week starting Monday 3 May 2021 An overview of the main financial regulation and banking stories this week and a look ahead to key events for the upcoming week, brought to you by the European Banking Federation.
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EU leaders to meet in Porto to discuss economic and social issues |
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On Saturday 8 of May, EU leaders will meet in Porto to discuss social issues, including those related to the COVID-19 pandemic. The informal European Council will follow the high-level conference 'Porto Social Summit' held by the Portuguese presidency on 7 May. The EU heads of state's discussion will focus on the implementation of the European Pillar of Social Rights at the EU and national level, as established by the EU Strategic Agenda 2019-2024. The Action Plan presented by the Commission in March 2021 provides guidance on the implementation of the European Pillar of Social Rights, including in the areas of employment, skills and social protection. At the end of the summit, EU leaders are expected to adopt a declaration. Read more |
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FINANCIAL REGULATION AGENDA for next week Monday 3 May: EBF Hedge Accounting Working Group virtual meeting Tuesday 4 May: EBF Financing Growth Steering Group virtual meeting Wednesday 5 May: EBF Payment Systems Committee virtual meeting Thursday 6 May: EBF Extraordinary Executive Committee virtual meeting Friday 7 May: Council Working Party on Financial Services Saturday 8 May: For a full-year overview of key financial regulation events: click here |
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FROM THE MEDIA this week
FT: BNP Paribas buoyed by drop in bad loan provisions
A rebound in equity trading and lower provisions for bad loans helped to boost BNP Paribas’ first-quarter results, although the French bank’s fixed income business struggled. France’s biggest listed bank said net profit rose 38 per cent compared with the same period last year to €1.8bn, ahead of analysts' expectations of €1.4bn but below its level in 2019. Revenues were up 8.6 per cent to €11.8bn, also ahead of what analysts had pencilled in. Read more (€)
LSE: Opposition to austerity outweighs support for the euro in Italy Could a new financial crisis, brought on by the Covid-19 pandemic, lead to Italy’s exit from the eurozone? Lucio Baccaro, Björn Bremer and Erik Neimanns present evidence from a new survey experiment on Italian attitudes toward a European bailout and exit from the euro. They find that a majority of voters would opt to stay in the euro if a bailout did not involve conditionality, but that there would be a majority for leaving if a bailout were contingent on austerity policies, LSE reports. Read more ING Think: Riksbank tightening some way off despite latest cautious optimism In many ways, the Swedish Riksbank finds itself in a similar position to that of other central banks across Europe. The economy has grown more resilient to Covid-19 restrictions, and indeed a more robust winter performance than expected has enabled the Riksbank to upgrade its forecasts slightly for this year, though the overall profile beyond 2021 is virtually unchanged for both growth and inflation, ING Think economists write. Read more Reuters: The great exit: central banks line up to taper emergency stimulus The Bank of Canada set the taper ball rolling last week, becoming the first major central bank to cut back on pandemic-era money-printing stimulus programmes. So who’s next? The big guns of central banking - the U.S. Federal Reserve, European Central Bank and the Bank of Japan - won't officially pare stimulus for a while, a message the BOJ reinforced on Tuesday and one the Fed is expected to reiterate on Wednesday, Reuters writes. Read more
Cointelegraph: Decentralization is the final frontier for CBDCs
As central bank digital currencies, or CBDCs, continue to garner mainstream traction across the global financial landscape in recent years, almost all central banks are actively researching the benefits and risks of offering a digital currency to the public. According to Cointelegraph, in its most basic sense, a CBDC is a digital form of fiat money, backed by a suitable amount of monetary reserves like gold or foreign currency reserves. Read more |
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FROM EBF MEMBERS this week
AEB: A single European fund for all depositors This is a key moment when the discussions on the single deposit fund are being unblocked in the EU. Spanish Banking Association (AEB) advisor Carmen Rizo explained the need to equalize protection for all savers in her latest post. Read more (ES) FBF: Banks on the way to sustainable finance Aware of the role of banks in fostering the energy transition, French banks intend to accelerate the transformation of their business models to meet the objectives of the Paris Agreement as quickly as possible, the French Banking Association (FBF) reports. Read more (FR) FFI: Cash makes a slow death but a lot of people aren't ready to give up cash New technology and digital payments are replacing the use of cash. The reasons are security on the one hand and the fact that processing cash is becoming more expensive than other payment methods on the other. According to Finance Finland (FFI), banknotes and coins will be needed for a long time to come. Read more (FI)
BdB: The trade agreement between the EU and UK to offer a sound basis for financial cooperation
The ratification of the Trade and Cooperation Agreement between the EU and the UK is a vital element of the memorandum of understanding (MoU) on the financial sector. "The memorandum must be finalized to establish a financial dialogue and clarify market access issues", said Andreas Krautscheid, Chief Executive of the Association of German Banks (BdB). Read more
UK Finance: Implementing the Supervisory Statement
The financial sector has seen a growing focus on the need to regulate and manage its outsourcing and third-party relationships. After the consultation period which included a response from UK Finance to The Prudential Regulation Authority (PRA), firms are expected to comply with the expectations in the Supervisory Statement by 31 March 2022. Read more |
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FROM THE INSTITUTIONS this week
ECB: All the way to zero: guiding banks towards a carbon-neutral Europe
ECB has published the remarks Frank Elderson, Vice-Chair of the Supervisory Board and Member of the Executive Board of the ECB, who has discussed ‘guiding banks towards a carbon-neutral Europe’. He notes that risk can affect banks through different channels, with physical risks resulting from a changing climate, and transitional risks via financial losses that can directly or indirectly result from the process of adjusting to a low-carbon and more environmentally sustainable economy. Read more ESMA enters final stage in the registration of the first securitisation repositories ESMA announced that it has reached the last stage in the assessment process of applications received from Securitisation Repositories (SRs) under the Securitisation Regulation (SECR). Read more ECON: Draft of the annual report on the Banking Union 2020 The draft report published by the European Parliament’s Committee on Economic and Monetary Affairs (ECON) highlights the need for increased cooperation between the SSM and the SRB, a shift from pandemic relief to recovery support tools and greater investments in digitalization. Read more EBA: Guidelines on the delineation and reporting of available financial means of Deposit Guarantee Schemes EBA launched a public consultation on its draft Guidelines on the delineation and reporting of available financial means (AFM) of Deposit Guarantee Schemes (DGSs). The purpose is to delineate that only funds contributed by credit institutions will count towards reaching the target level of the DGS fund. Read more
BIS: Mário Centeno: Monetary policy in transition
While the policy response to the pandemic remains a remarkable showcase of the power of monetary and fiscal policy interaction, a strategic review of the paradigm is ongoing. The symmetric price stability objective is expected to be combined with measures to improve the fundamentals of the economy and support the green and digital transition, Mário Centeno, Governor of the Banco de Portugal said at The Institute of International and European Affairs webinar. Read more |
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FROM THE EUROPEAN BANKING FEDERATION this week
European Commission Referral Scheme Consultation: EBF response
The EBF has responded to the European Commission’s consultation on a potential referral scheme. Have a look at the web post and see our recommendations. Read more ESMA consultation on Appropriateness Guidelines Under MIFID II: EBF response The EBF welcomes ESMA’s effort to give guidelines on how to best apply the appropriateness test requirements. Below a few points, the EBF and its members underline: 1) The appropriateness guidelines as proposed by ESMA are going further than the original idea behind level 1 requirements; 2) Information provided to investors should be proportionate as far as the extent of information, means of communication and timing are concerned. one may fear that if too much information and too many details are required from clients, they may be desensitized to invest which would be contrary to CMU overarching objectives. Read more |
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ABOUT THE EUROPEAN BANKING FEDERATION
The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The federation is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu |
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