On 31 July 2020, the PRA published Consultation Paper 12/20: Capital Requirements Directive V (CP12/20). In CP12/20 the PRA sets out proposed changes to its rules, supervisory statements (SS) and statements of policy (SoP) in order to implement elements of the Capital Requirements Directive V (CRD V). CP12/20 covers: The PRA’s proposed implementation of changes to Pillar 2 provisions relating to firms’ internal capital assessments, supervisory review of those assessments, and the additional capital requirements…

On 31 July 2020, the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) issued a consultation revising their joint guidelines on the assessment of the suitability of members of the management body and key function holders. The review reflects the amendments introduced by the fifth Capital Requirements Directive (CRD V) and the Investment Firms Directive (IFD) in relation to the assessment of the suitability of members of the management body. The…

On 31 July 2020, the European Banking Authority (EBA) issued a consultation seeking to revise its guidelines on internal governance. The guidelines were developed on the basis of Article 74 of the Capital Requirements Directive IV (CRD IV), which mandates the EBA to further harmonise credit institutions’ governance arrangements, processes and mechanisms across the EU. The draft revised guidelines take into account the amendments introduced by the fifth Capital Requirements Directive (CRD V) and the…

On July 31, 2020, the Federal Register published the final Volcker Rule covered funds amendments promulgated in June by the federal financial services regulators (the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Securities and Exchange Commission, the Office of the Comptroller of the Currency, and the Commodity Futures Trading Commission). In her latest New York Law Journal International Banking column, “Volcker Rule covered funds revisions finalized: Impact on non-US banks,” Kathleen A.…

On July 22, 2020, the US Office of the Comptroller of the Currency (OCC) issued an interpretive letter concluding that national banks and federal savings associations have the authority to provide cryptocurrency custody services for customers. The letter, which uses the term “cryptocurrency” to encompass digital currencies, virtual currencies, and “digital assets that are not broadly used as currencies,” is a strong show of support for responsible innovation within the national banking system and offers…

On 30 July 2020, the FCA issued a statement setting out its view of the risks and benefits of Employer Salary Advance Schemes (ESAS) and what employers and employees should consider when using them. The statement covers: What ESAS offer. What employees need to consider. What employers need to consider. The FCA reminds employers that they need to consider all aspects of the scheme, the advantages and the potential risks, when offering ESAS to their…

On 30 July 2020, the European Banking Authority announced that it had agreed on the tentative timeline and sample of the 2021 EU-wide stress test. The stress test will be carried out at the highest level of consolidation on a sample of 51 banks, of which 39 will be from the Euro Area, covering broadly 70% of the banking sector in the euro area, each non-Eurozone Member States and Norway. The stress test is expected…