The next AMIC Conference will take place in Paris, on 11 March, in partnership with AF2I and will be hosted by BNP Paribas Asset Management. The conference will feature panels and keynotes on fund liquidity and leverage, challenges and opportunities in the current investment environment, sustainable finance and asset allocation. The event is free to attend for all but registration in advance is essential.
The next AMIC Executive Committee meeting will also take place in Paris on 11 March.
ICMA Asset Management and Investors Council (AMIC) Regulatory Update
31 January 2020 OECD publishes report on Global insurance market trends
The Organisation for Economic Co-operation and Development (OECD) has published the ninth edition of their Global Insurance Market Trends report which provides an overview of market trends to better understand the overall performance and health of the insurance market. This monitoring report is compiled using data from the OECD Global Insurance Statistics (GIS) database.
31 January 2020 ESMA provides an update on the governance and reporting obligations for UK entities following Brexit
The European Securities and Markets Authority (ESMA) has published a statement to clarify issues relating to its governance and the reporting obligations for UK entities from 1 February 2020 following the United Kingdom’s (UK) withdrawal from the European Union (EU).
31 January 2020 ESMA consults on MIFIR Transparency Regime for Systematic Internalisers
The European Securities and Markets Authority (ESMA) has launched a consultation on the MiFIR pre-trade transparency regime for systematic internalisers (SI) active in non-equity instruments.
ESMA published this consultation paper in the context of the monitoring it shall perform under MiFIR on the application of the pre-trade transparency obligations applicable to SIs in respect of bonds, structured finance products, emission allowances and derivatives (non-equity instruments).
The consultation ends on 18 March 2020. ESMA and will develop the final report taking into consideration the feedback received and intends to submit the final report to the European Commission in July 2020.
31 January 2020 Speech by Claudia Buch (Bundesbank) on Risks and Resilience in the Financial System: A German Perspective
Speech by Prof Claudia Buch, Vice-President of the Deutsche Bundesbank, on risks and resilience in the financial system from a German perspective. She elaborated on three key vulnerabilities of the German financial system:
- After ten years of relatively strong growth, future credit risks are potentially being underestimated.
- Valuations of loan collateral such as real estate are potentially being overestimated.
- The situation is further compounded by interest rate risk. Both an abrupt rise in interest rates and persistently low interest rates would put pressure on the German financial system.
31 January 2020 Speech by Sharon Donnery (CBI) Central banks and public policy: stability in an interconnected world
Speech by Sharon Donnery, Deputy Governor at the Central Bank of Ireland (CBI) about the role of central banks in public policy, why they are so focussed on stability, and how they think about change, and respond to the interconnected world we live in.
She spoke about the importance of a multilateral approach, especially when around issues that may take centre stage in the decade ahead for policymakers worldwide: like climate change, the changing financial system and technological change.
5 February 2020 Speech by Donald Kohn (BoE) on stress tests: a policymaker’s perspective
Speech by Donald Kohn, Member of the Financial Policy Committee at the Bank of England (BoE), on stress testing. He looks at the issue of aligning stress test results with the appropriate counter-cyclical buffer (CCyB) over the entire financial cycle, and addresses the need for transparency to improve market discipline and banks’ risk management.
3 February 2020 ESRB issues letter to the European Commission on the AIFMD framework
The European Systemic Risk Board (ESRB) has issued a letter to the European Commission on the shortcomings of the current AIFMD framework.
The letter focused on three big areas (i) the suitability of the AIFMD reporting framework and access to data for monitoring systemic risk, (ii) the need to operationalise existing macroprudential policy instruments, and (iii) the ongoing development of the macroprudential policy framework “beyond banking” and for investment funds in particular.
5 February 2020 ESMA proposes short technical delay to CSDR settlement discipline application
The European Securities and Markets Authority (ESMA) has published a Final Report on draft regulatory technical standards (RTS) on postponing the date of entry into force of the Commission Delegated Regulation (EU) 2018/1229 (RTS on settlement discipline) to 1 February 2021.
ESMA has proposed this delay to the entry into force of the RTS on settlement discipline, having taken into account the additional time needed for the establishment of essential features for the functioning of the settlement discipline regime, such as the necessary ISO messages, the joint penalty mechanism of CSDs that use a common settlement infrastructure, and the need for proper testing of the new functionalities.
5 February 2020 ESMA launches common supervisory action with NCAs on MiFID II Suitability Rules
The European Securities and Markets Authority (ESMA) has launched a common supervisory action (CSA) with national competent authorities (NCAs) on the application of MiFID II suitability rules across the European Union (EU). The CSA will be conducted during 2020.
The CSA will focus on the application of the MiFID II requirements on the assessment of suitability. This action will allow ESMA and the NCAs to gauge the progress made by intermediaries in the application of this key requirement. It will also help in the analysis of whether, and how, the costs of investment products are taken into account by firms when recommending an investment product to a client.
6 February 2020 ESMA sets out its strategy on sustainable finance
The European Securities and Markets Authority (ESMA) has 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.
6 February 2020 EIOPA publishes discussion paper on IBOR transition
The European Insurance and Occupation Pensions Authority (EIOPA) has published a discussion paper on IBOR transitions. Following the EU Benchmark Regulation (EU BMR), this Discussion Paper addresses the subject of ongoing changes to the new benchmark rates (or IBOR transitions). The focus of this paper is to address issues identified within the EIOPA Risk free rate (RFR) environment.
The discussion paper highlights the potential impact of the IBOR transitions on the definition and the use of the Credit Rate Adjustment (CRA) currently applied on the RFR term structures. Furthermore, we propose options and a coherent approach for dealing with the new term structures calculated with the new benchmark rates for all currencies.
Upcoming ICMA Courses
Collateral Management London, 30-31 March
Inflation-Linked Bonds and Derivatives London, 2-3 April
Fixed Income Certificate (FIC) Amsterdam, 18-22 May
Fixed Income Portfolio Management & Construction London, 27-29 May
Financial Markets Foundation Qualification (FMFQ) London, 3-5 June
Securitisation: An Introduction London, 16-17 September
Introduction to Fixed Income Qualification (IFIQ) London, 19-21 October