EBA
Launches discussion on 2023 EU-wide stress test methodology
21 July 2022
The European Banking Authority ("EBA") published its 2023 EU-wide stress test draft methodology, templates and template guidance, which will be discussed with the industry. The methodology covers all risk areas and builds on the one prepared for the 2021 EU wide stress test. Some aspects of the methodology have been improved based on the lessons from the 2021 exercise. As a new feature, the projections on net fee and commission income ("NFCI") will be based on a top-down model. This is a first step of revising the EU-wide stress test framework towards a hybrid (bottom-up and top-down) approach. Also, the sample coverage has been increased. An additional 26 banks have been added to the stress test sample compared to the 2021 exercise and further proportionality has been introduced into the methodology. The 2023 exercise will assess EU banks' resilience to an adverse economic shock and inform the 2023 Supervisory Review and Evaluation Process ("SREP"). For more information please press here.
EBA
Publishes final regulatory products to harmonise the supervisory review and evaluation process of investment firms
21 July 2022
The EBA jointly with the European Securities and Markets Authority ("ESMA"), published the final Guidelines on common procedures and methodologies for the SREP for investment firms. The EBA published also the final draft Regulatory Technical Standards ("RTS") on Pillar 2 add-ons for investment firms. Both regulatory products are based on the Investment Firms Directive ("IFD") and aim to harmonise the supervisory practices regarding the supervisory review and evaluation process of investment firms. For more information please press here.
EBA
Observes a reduction of high earners in 2020 and a slight decrease of bonus levels in the context of the COVID-19 pandemic
21 July 2022
The EBA published its report on benchmarking of remuneration practices in EU banks for the financial years 2019 and 2020 and high earners data (EU27/EEA) for 2020. The number of high earners went down from 1 444 (EU27/EEA) or 4 963 (EU28/EEA) in 2019 to 1 383 (EU27/EEA) in 2020. While the bonus level for high earners remained relatively stable, a visible reduction can be observed for risk takers (identified staff). For more information please press here.
Market News
Bloomberg Europe gas rises as Russian supply via key route stays in focus
22 July 2022
"European natural gas prices rose as Russian supply through a major pipeline remained at the center of traders’ attention despite stable shipments for a second day." For more information please press here.
Reuters
World stocks edge higher for sixth day of gains, dull business activity hits euro
22 July 2022 "Global stocks were marginally higher on Friday, eyeing a sixth day of gains as European markets rose, while weak euro zone business activity data hit the euro and weighed on the bloc's debt." For more information please press here.
Financial Times
Pakistan’s rupee falls fast as default fears intensify
22 July 2022 "Currency on track for worst week in more than two decades amid concerns IMF deal will not avert crisis." For more information please press here.
Cryptocurrencies
Bloomberg
Crypto-asset platforms to face stricter rules in Thailand
22 July 2022
"Thailand plans to tighten supervision of digital-asset firms after a cryptocurrency selloff saddled retail investors with large losses and toppled several companies, the country’s top regulator said." For more information please press here.
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