European Commission Banking Package proposal
On February 22, ESBG responded to the European Commission “have your say" consultation on the Banking Package proposal, which transposes the final elements of the Basel III reforms in the EU regulatory framework and pursues other prudential and supervisory objectives.
ESBG supports the application of the output floor at the highest level of consolidation. The envisaged single-stack approach however requires that supervisory powers are more clearly framed and that the arrangements mitigating its impact are of a longer-term nature or permanent. The transitional arrangements for residential real estate, unrated corporates and derivatives should be made permanent or at least phased out based on the actual observation of structural changes in the EU banking market. Moreover, these flexibilizations should be extended also to institutions using the standardised approach to maintain a level playing field.
We recognise the proposal to disregard historical operational losses for all institutions within the calculation of capital requirements for operational risk, meaning that the internal loss multiplier (ILM) is effectively being set equal to one. This is a discretion provided in the Basel framework.
As regard to equity exposures, we support the implementation of a new category with a lower 100% risk weight (RW) for long term strategic equity investments.
Regarding specialised lending, we support the proposal to increase the risk sensitivity for unrated object finance exposures.
With respect to real estate exposures, the proposed requirements for non-income producing real estate should not go beyond the Basel standards. We then support the increased risk sensitivity for acquisition, development and construction (ADC) lending.
The threshold to use the simplified credit valuation adjustment (CVA) method should be aligned with the provision in the Basel framework.
We warn against an excessively restrictive application of the credit conversion factor (CCF) to trade finance instruments and to other exposures.
The proposed centralization of the disclosures is appreciated. Small and non-complex institutions should be exempted from reporting and disclosing requirements in the area of Environmental, Social and Governance (ESG). Further proportionality elements could then be envisaged.
Furthermore, the decision to retain important EU features such as the SME and the Infrastructure supporting factors and the CVA exemptions is appreciated.
related
May 4, 2023
ESBG responds to the Commission’s consultation on its Taxonomy Environmental Delegated Act
On 3 May, ESBG responded to the Commission’s consultation on its new set of EU taxonomy criteria for economic activities that
April 12, 2023
ESBG revises its position paper on the CSDDD in accordance with the recent negotiations
Given the developments of the recent political negotiations, ESBG has decided to update its position paper on the Corporate Sustainability Due Diligence Directive (CSDDD)
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
August 3, 2022
International Sustainability Standards Board consultation on Sustainability Disclosures
The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital…
July 8, 2022
World savings and retail banks call for harmonised taxonomies on sustainable finance
The World Savings and Retail Banking Institute (WSBI) called today on policymakers for the harmonisation of taxonomies on sustainable finance. At the end of the 26th WSBI World Congress, the…
Considerations on the BCBS principles for the management & supervision of climate-related financial risks
The Basel Committee on Banking Supervision (BCBS) has published a public consultation on principles for the effective management and supervision of climate-related financial risks. The document forms part of the Committee’s holistic approach to address climate-related financial risks to the global banking system and aims to promote a principles-based approach to improving both banks’ risk management and supervisors’ practices in this area. This new position paper based on our response to the consultation.
related
May 4, 2023
ESBG responds to the Commission’s consultation on its Taxonomy Environmental Delegated Act
On 3 May, ESBG responded to the Commission’s consultation on its new set of EU taxonomy criteria for economic activities that
April 12, 2023
ESBG revises its position paper on the CSDDD in accordance with the recent negotiations
Given the developments of the recent political negotiations, ESBG has decided to update its position paper on the Corporate Sustainability Due Diligence Directive (CSDDD)
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
August 3, 2022
International Sustainability Standards Board consultation on Sustainability Disclosures
The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital…
May 27, 2022
ESBG calls for more feasible rules on the new corporate sustainability due diligence
In its response to the European Commission call for feedback on the proposal for a Directive on Corporate Sustainability Due Diligence, the European Savings and Retail Banking Group (ESBG) suggests…
Considerations on the BCBS principles for the management & supervision of climate-related financial risks
The Basel Committee on Banking Supervision (BCBS) has published a public consultation on principles for the effective management and supervision of climate-related financial risks. The document forms part of the Committee’s holistic approach to address climate-related financial risks to the global banking system and aims to promote a principles-based approach to improving both banks’ risk management and supervisors’ practices in this area. This new position paper based on our response to the consultation.
related
May 4, 2023
ESBG responds to the Commission’s consultation on its Taxonomy Environmental Delegated Act
On 3 May, ESBG responded to the Commission’s consultation on its new set of EU taxonomy criteria for economic activities that
April 12, 2023
ESBG revises its position paper on the CSDDD in accordance with the recent negotiations
Given the developments of the recent political negotiations, ESBG has decided to update its position paper on the Corporate Sustainability Due Diligence Directive (CSDDD)
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
August 3, 2022
International Sustainability Standards Board consultation on Sustainability Disclosures
The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital…
May 27, 2022
ESBG calls for more feasible rules on the new corporate sustainability due diligence
In its response to the European Commission call for feedback on the proposal for a Directive on Corporate Sustainability Due Diligence, the European Savings and Retail Banking Group (ESBG) suggests…
Access to better technology for (Supervisory) Reporting
On 18 February 2022, the four European banking associations (EACB, EAPB, EBF and ESBG) co-hosted the “Access to better technology for (Supervisory) Reporting” workshop that brought together the entire European banking industry, the European Banking Authority and the international RegTech community to openly exchange views and learn from each other on how RegTech solutions could help banks reduce their reporting costs and what are the hurdles to clear along the way.
300 participants across Europe participated in this half-day, targeted workshop. The presentations delivered by the banking industry clearly revealed the many challenges and complexities the industry has been facing for about 15 years due to the flood of additional data reporting requirements to banks. Data has never been as important as it is now with regulatory reporting having shifted from a simple administrative task in the past to a strategic objective high in the agenda of banks and a steering tool, with supervisors placing increasing focus on data quality. The current situation is the result of a layering of successive regulations, by different authorities at national and EU level, with the added complexities of different definitions and shorter delivery times demanding substantial investment by banks in systems, processes, and specialized staff. Banks have been mastering these challenges very well, generally speaking, but there is always room to become even more efficient.
While there are existing cases where banks are already benefitting from the use of technology either from in-house solutions or by creating a shared utility as result of a joint venture or other forms of pooling of resources by a number of banking groups in a country, the discussion revealed there is still ample room to explore and lot of work ahead to benefit from technology at a large scale.
A dedicated panel composed by RegTechs based across Europe confirmed that technology is available or is being developed to support banks with a wide range of services offering from end-to-end to targeted solutions. RegTechs also confirmed complexity is the most challenging aspect in the current reporting environment identifying standardization, infrastructure, and automation as tools to decrease the complexity.
The different ways regulatory reporting is done in Europe also adds complexity. Creating a more functional and interconnected ecosystem is key to start moving towards a much-needed standardization where RegTechs can play a key role. Replying to questions raised by the banking industry, RegTechs stressed that technology should be seen as innovation that could help banks reach beyond the 15-24% cost reduction as estimated by an EBA study last year, rather than a black box that brings its own complexity. RegTechs are also trying to remove barriers by intensively promoting their services for which forums like the workshop organized by the trade banking associations was an ideal setting to bridge the gaps between RegTech and the banking industry.
With a forward-looking perspective, the EBA provided an overview of how the different recently launched initiatives such as the Integrated Reporting System and the Commission’s supervisory data strategy aim to shape the future of supervisory reporting. The challenge is big, but the benefits are worth. The banking industry, RegTech community and supervisory authority agreed events like the workshop are key to foster collaboration and they will stay in close contact.
related
May 4, 2023
ESBG responds to the Commission’s consultation on its Taxonomy Environmental Delegated Act
On 3 May, ESBG responded to the Commission’s consultation on its new set of EU taxonomy criteria for economic activities that
April 12, 2023
ESBG revises its position paper on the CSDDD in accordance with the recent negotiations
Given the developments of the recent political negotiations, ESBG has decided to update its position paper on the Corporate Sustainability Due Diligence Directive (CSDDD)
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
August 3, 2022
International Sustainability Standards Board consultation on Sustainability Disclosures
The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital…
July 8, 2022
World savings and retail banks call for harmonised taxonomies on sustainable finance
The World Savings and Retail Banking Institute (WSBI) called today on policymakers for the harmonisation of taxonomies on sustainable finance. At the end of the 26th WSBI World Congress, the…
Clear and fair rules for the use of machine learning in Internal Rating Based models
The European Savings and Retail Banking Group (ESBG) welcomes the initiative of the European Banking Authority (EBA) to discuss the implications of the use of machine learning (ML) in the internal rating based (IRB) models for credit risk.
We encourage the EBA to build a clear and fair supervisory scheme that goes further and allows compliance with the proposed principles to be measured, and that finds the balance between the advantages and the new risks that machine learning brings.
related
May 4, 2023
ESBG responds to the Commission’s consultation on its Taxonomy Environmental Delegated Act
On 3 May, ESBG responded to the Commission’s consultation on its new set of EU taxonomy criteria for economic activities that
April 12, 2023
ESBG revises its position paper on the CSDDD in accordance with the recent negotiations
Given the developments of the recent political negotiations, ESBG has decided to update its position paper on the Corporate Sustainability Due Diligence Directive (CSDDD)
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
August 3, 2022
International Sustainability Standards Board consultation on Sustainability Disclosures
The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital…
May 27, 2022
ESBG calls for more feasible rules on the new corporate sustainability due diligence
In its response to the European Commission call for feedback on the proposal for a Directive on Corporate Sustainability Due Diligence, the European Savings and Retail Banking Group (ESBG) suggests…
Proportional and clear guidelines would ensure citizens' data protection and foster innovation
The ESBG, together with eight other associations representing the EU payment sector, has written to the European Data Protection Board, the European Commission and the European Banking Authority about the EDPB Guidelines 06/2020 on the interplay between the reviewed Payment Services Directive (PSD2) and the General Data Protection Regulator(GDPR).
The letter highlights that while the payments sector remains fully committed to ensuring the protection of EU citizen’s data- including within the framework of PSD2 – there are concerns that the enforcement of the Guidelines will lead to an outcome that is not in line with PSD2 objectives. In the end, this would hinder innovation and competition in payments.
Although the final Guidelines help in clarifying certain aspects of the interplay, our letter emphasises and reiterates common concerns:
- Provisions on data minimization create uncertainties and are potentially in conflict with PSD2;
- There is lack of coherence with the Regulatory Technical Standards on Strong Customer Authentication and Common and Secure Communication (RTS on SCA & CSC);
- Financial transaction data should not be considered as special category of personal data (SCPD). As such, if financial transaction data is not processed in order to infer SCPD, Article 9(1) GDPR should not apply.
- There are resulting concerns that national Data Protection Authorities could start taking a differentiated approach to the interpretation of the provisions, resulting in fragmentation across the EU and adding to a growing trend when it comes to GDPR implementation.
Overall, the EU payments industry welcomes further discussion between all relevant institutions and stakeholders in the GDPR-PSD2 ecosystem to address these challenges and to provide legal certainty for all actors to enable them to meet their obligations and continue to provide top-tier services for their customers.
related
May 4, 2023
ESBG responds to the Commission’s consultation on its Taxonomy Environmental Delegated Act
On 3 May, ESBG responded to the Commission’s consultation on its new set of EU taxonomy criteria for economic activities that
April 12, 2023
ESBG revises its position paper on the CSDDD in accordance with the recent negotiations
Given the developments of the recent political negotiations, ESBG has decided to update its position paper on the Corporate Sustainability Due Diligence Directive (CSDDD)
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
August 3, 2022
International Sustainability Standards Board consultation on Sustainability Disclosures
The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital…
July 8, 2022
World savings and retail banks call for harmonised taxonomies on sustainable finance
The World Savings and Retail Banking Institute (WSBI) called today on policymakers for the harmonisation of taxonomies on sustainable finance. At the end of the 26th WSBI World Congress, the…