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The Financial Stability Board (FSB) has published a progress report on the implementation of its September 2014 recommendations for reforms to foreign exchange (FX) benchmarks. The overall assessment of the report is that there has been good progress in implementing many of the September 2014 recommendations, although on some, the progress has been mixed. In particular, the FSB notes that it’s worth re-emphasising that the recommendations are intended to apply to all FX benchmarks, to…
The European Banking Authority (EBA) has published a report regarding the benchmarking of remuneration practices across the EU and the aggregated data on the remuneration of EU institutions’ staff who received, in total, EUR one million or more in 2013. Key points in the report include: the percentage of high earners who are identified staff has slightly increased over time; the number of high earners decreased from 3,530 in 2012 to 3,178 in 2013. This…
The FCA has published Thematic Review 15/11: Financial Benchmarks: Thematic review of oversight and controls (TR15/11). In TR15/11 the FCA presents the findings from its thematic review of firms’ oversight and controls in relation to financial benchmarks. The review covered firms’ systems and controls arrangements around benchmark activities such as: (i) governance, accountability, oversight and control; (ii) monitoring and surveillance arrangements; and (iii) identification and management of the potential conflicts of interest arising in day-to-day…
In May 2014, the Governors of the Bank of International Settlements announced the formation of the Foreign Exchange Working Group (FXWG) to strengthen code of conduct standards and principles in FX markets. The FXWG, which aims to facilitate the establishment of a single global code of conduct standards and principles and to promote greater adherence to these standards and principles has now been established. The global code is intended to cover all parts of the…
The European Banking Authority has published amendments to the adopted regulatory technical standards (RTS) on the criteria to identify categories of staff whose professional activities have a material impact on an institution’s risk profile. These RTS were published by the European Commission as a Delegated Act on 6 June 2014.…
In July 2014 the Financial Stability Board (FSB) published a report entitled Reforming Major Interest Rate Benchmarks, which proposed recommendations, developed by the Official Sector Steering Group (OSSG), for enhancing existing benchmarks for key interbank unsecured lending markets (such as LIBOR, EURIBOR and TIBOR, collectively the “IBORs”), and to promote the development and adoption of nearly risk-free benchmark rates (RFRs) where appropriate. The report recommended that: there should be a strengthening in existing IBORs and…
The PRA and FCA have jointly published Policy Statement PRA12/15 FCA15/16: Strengthening the alignment of risk and reward: new remuneration rules (PS15/16). In PS15/16 the PRA and FCA jointly provide feedback, final rules and guidance in relation to the proposals that were set out in Consultation Paper 15/14: Strengthening the alignment of risk and reward: new remuneration rules (CP15/14). The primary changes are: extending deferral (the period during which variable remuneration is withheld following the…
There has been published two identical letters that the European Parliament’s Committee on Economic and Monetary Affairs (ECON) has sent to Steven Maijoor (Chairman, ESMA) and Jonathan Hill (EU Commissioner for Financial Stability, Financial Services and Capital Markets Union) concerning the Market Abuse Regulation (MAR) and managers’ transactions. In both letters ECON refers to a meeting of the European Parliament Negotiating Team for MAR which met on 12 May 2015. At this meeting ECON discussed…
The FCA has published on its website a letter that was sent to remuneration committee chairs of firms that fall within proportionality tier 1. The letter is dated November 2014 and was prepared, as firms went into the 2014/15 remuneration round, to highlight the FCA’s expectations on the application of malus that it expected a remuneration committee to meet. Firms are advised that the letter should be considered in the context of any previous firm-specific…