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ESMA updates Q&A on Implementation of CRA Regulation
February 17, 2020--The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers (Q&As ) on the Credit Rating Agencies Regulation (CRAR).
The Q&A provides clarification on what steps should a CRA take in order to ensure a sufficient level of quality and transparency in the periodic review of credit ratings conducted in accordance with Article 8(5) of CRAR.
UK economy flat-lined in fourth quarter before post-election bounce
February 11, 2020--Britain's economy flat-lined in the final three months of 2019, when the country was in a deadlock over Brexit that was only broken by Prime Minister Boris Johnson's December election victory, leading to some signs of a recovery early this year.
Official figures released on Tuesday showed zero growth in the fourth quarter compared with the third, matching the median forecast in a Reuters poll of economists.
Eurex launches additional ESG futures after successful first year of ESG trading
February 10, 2020--New STOXX USA 500 ESG-X Index Futures tradable at Eurex /First ESG contract covering the U.S. that excludes thermal coal/Broadest ESG offering worldwide in listed ESG derivatives
Eurex, the leading European derivatives exchange, looks back on a successful first year in ESG trading.
Investment companies are increasingly using ESG derivatives to hedge sustainably invested assets, as demonstrated by Metzler Asset Management's recently launched value protection fund. The launch of the new STOXX(R) USA 500 ESG-X Index Futures is the next step to support market participants in their sustainable investment strategies beyond Europe.
ESMA Publishes The Final Report On MIFIR Alignments following the Introduction of EMIR Refit
February 7, 2020--The European Securities and Markets Authority (ESMA) has today published a final report suggesting amendments to the trading obligation under MiFIR following the introduction of EMIR Refit.
The recent changes introduced to EMIR via Refit modify the scope of counterparties subject to the clearing obligation-exemption for small financial counterparties and modified determination of non-financial counterparties. The introduction of EMIR Refit has not been accompanied by direct amendments to MiFIR, which currently leads to a misalignment between the scope of counterparties subject to the clearing obligation (CO) under EMIR and the derivatives trading obligation (DTO) under MiFIR.
ESMA updates on progress on compliance with the MiFIR pre-trade transparency requirements in commodity derivatives
February 7, 2020--ESMA has today published a statement to provide an update on the implementation of the supervisory briefing on pre-trade transparency in commodity derivatives.
The Supervisory Briefing was developed after ESMA became aware that the requirements were not implemented in a consistent manner across the European Union.
It aims to increase supervisory convergence among national competent authorities (NCAs) in their implementation of the requirements and to provide a common timetable for the enforcement of the commodity derivatives pre-trade transparency regime, with the objective of ensuring a level playing field across EU trading venues.
From climate change to cyber-attacks: incipient financial-stability risks for the euro area
February 6, 2020--The European Central Bank's November 2019 Financial Stability Review highlighted the risks to growth in an environment of global uncertainty. On the whole, the ECB report is comprehensive and covers the main risks to euro-area financial stability, we highlight issues that deserve more attention.
First, the assessment of risks in the housing market should be more nuanced. Current housing markets relative to those pre-crisis seem to be far less driven by mortgage credit, and the size of the construction sector has not increased. This is possibly good news for financial stability because a house price correction would transmit less into mortgage defaults and corrections to economic activity.
Second, there should be greater emphasis on changes in market expectations of interest rates, which can have substantial effects on asset prices. This could be particularly relevant if interest rate changes are not driven by real-economy developments.
ESMA sets out its strategy on sustainable finance
February 6, 2020--The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, has today published its Strategy on Sustainable Finance. The strategy sets out how ESMA will place sustainability at the core of its activities by embedding Environmental, Social, and Governance (ESG) factors in its work.
The key priorities for ESMA include transparency obligations, risk analysis on green bonds, ESG investing, convergence of national supervisory practices on ESG factors, taxonomy, and supervision.
Climate risks to European banks: a new era of stress tests
February 4, 2020--Several European central banks have begun assessing the impact of adverse climate scenarios on banks' capital. Comparable work at EU or euro area level has evolved more slowly. Supervisors need build up a distinct and more complex type of analysis, and should engage with banks now.
The release of a proposed methodology for assessing climate risks within UK banks and insurers by the Bank of England just before Christmas has fuelled calls for a similar 'climate stress test' for European banks.
ESMA amends guidelines to further harmonise the enforcement of financial information by national regulators
February 4, 2020--The European Securities Markets Authority (ESMA) has published today an amended version of its guidelines on enforcement of financial information. The Guidelines apply to national competent authorities' (NCAs) enforcement of financial information which issuers, listed on regulated markets, are required to publish under the Transparency Directive.
Following a 2017 peer review on the implementation of certain aspects of the Guidelines, ESMA decided to amend the Guidelines in order to further harmonise the way NCAs enforce the financial disclosures of European issuers.
ESMA consults on MiFIR transparency regime for equity instruments
February 4, 2020--The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, has launched a Consultation Paper (CP ) reviewing the MiFIR transparency regime for equity, ETFs and other related instruments.
The CP contains proposals, based on in-depth data analysis of the effects of the current regime since January 2018, for possible amendments to the transparency regime.
ESMA's objective of the review is to simplify the current complex trade reporting regime while trying to improve the overall trade transparency available to market participants.
