EBA欧洲银行-EBA-BS-2017-170rev1-28Final-Minutes-BoS-3-4-May-2017-For-publication29_17页_409kb

EBA Board of Supervisors – Final Minutes Summary (May 2017)

Core Content

The EBA Board of Supervisors (BoS) convened from 3–4 May 2017 in London and addressed a range of topics, including elections, regulatory guidelines, transparency exercises, stress testing, and issues related to Brexit and the European Supervisory Authorities (ESAs). The meeting aimed to ensure alignment and cooperation among supervisory authorities across the EU.

Main Points and Key Information

Agenda Item 1: Welcome and Approval of Agenda

• The BoS approved the meeting agenda.
• Minutes from the 14–15 February meeting, approved by written procedure on 3 April, were already published.
• The BoS agreed to approve future minutes by written procedure to accelerate their publication.
• New voting members and alternates were appointed from the Czech National Bank, Central Bank of Ireland, and Bank of Slovenia.
• Members were invited to suggest topics for the upcoming Away day meeting in Tallinn on 13–14 July.

Agenda Item 2: Election of a Management Board Member

• A vacancy in the Management Board (MB) was filled following a call for nominations launched on 15 March.
• Jo Swyngedouw was elected as a member of the MB for a first term of 2.5 years, effective immediately.

Agenda Item 3: Election of Substitute Members of the Mediation Panel

• Two applications were received to fill three substitute positions on the Mediation/Breach of Union Law Panel.
• Csaba Kandrács and Raimund Roeseler were elected as substitute members.
• A new call for nominations was planned to fill the remaining vacancy.

Agenda Item 4: Amendment of Mediation Panel Rules

• Amendments to the Rules of Procedure for both binding and non-binding mediation were discussed.
• The amendments aimed to reflect EU financial law acts incorporated into the EEA Agreement and facilitate the appointment of alternate members from the Standing Committee on Resolution (ResCo).
• The wording of Article 9.1 f) and h) was slightly adjusted to avoid implying that the EFTA Surveillance Authority was obligated to adopt EBA acts.
• The BoS approved the amendments and proposed to the European Commission, Council, and European Parliament to consider legislative changes for the direct appointment of ResCo members in the Panel.

Agenda Item 5: Update on Risks and Vulnerabilities

• The EBA Director of Oversight presented an update on the European banking sector's risks and vulnerabilities.
• CET1 ratios remained stable, but asset quality varied significantly across EU jurisdictions.
• Profitability was below 2014–2015 levels, with some countries showing increased impairments.
• The Chair of the Standing Committee on Oversight and Practices (SCOP) discussed the role of cost of equity (CoE) as a sustainability indicator.
• The BoS welcomed the EBA's suggestion for deeper bank-by-bank analyses and invited members to share experiences on cross-border issues like the 'Russian Laundromat' case.

Agenda Item 6: 2017 EU-wide Transparency Exercise

• The EBA's Risk Analysis Unit outlined the 2017 EU-wide transparency exercise, which would focus on COREP/FINREP data for 2016 Q4–2017 Q2.
• The exercise would be published alongside the Risk Assessment Report (RAR).
• The BoS approved the proposal, with some members requesting bilateral discussions on specific banks.
• The draft methodology would be finalised by end-May and submitted for informal consultation in June/July.

Agenda Item 7: 2018 EU-wide Stress Tests

• The BoS discussed the methodology for the 2018 stress tests.
• The methodology was seen as too complex, despite efforts to simplify it.
• The treatment of zero rate deposits and extraordinary ex-post adjustments were debated, with no consensus reached.
• The possibility of an overlay or cap on net interest income (NII) was raised, and the STTF was asked to conduct further work.
• The BoS agreed to publish a methodology for consultation, including a question on zero rate deposits, and to delay final decisions on other elements until further internal work was done.

Agenda Item 8: Final Guidelines on ICT Risk Assessment under SREP

• The final Guidelines on ICT Risk Assessment under the Supervisory Review and Evaluation Process (SREP) were approved.
• These guidelines would apply from 01 January 2018 and be integrated into the SREP guidelines in the future.

Agenda Item 9: Consultation Paper on Outsourcing to Cloud Service Providers

• A consultation paper on outsourcing to cloud service providers was endorsed for publication.
• It emphasized the need for written agreements granting unrestricted audit rights to supervisory authorities.
• A reference to payment institutions was included in the accompanying communication.

Agenda Item 10: Consultation Paper on Draft RTS on Simplified Obligations

• The BoS endorsed a consultation paper on draft Regulatory Technical Standards (RTS) for simplified obligations.
• A quantitative score threshold of 25 bps was proposed, with discretion for CAs to adjust it.
• The work on guidelines was put on hold, with the EBA to monitor developments from the Basel Committee on Banking Supervision (BCBS) and re-evaluate the guidelines.

Agenda Item 11–12: CVA Risk Treatment and Monitoring

• The BoS agreed to publish a report on the 2015 CVA monitoring exercise and to start the 2016 monitoring.
• The work on CVA guidelines was postponed due to uncertainty around BCBS developments and the need for greater consistency.

Agenda Item 13: Brexit-Related Work Programme

• The BoS approved the Brexit work programme and agreed to discuss governance and implementation details in the upcoming June meeting.

Agenda Item 14: Commission's Consultation on ESAs Review

• The EBA draft opinion on the ESAs review was presented.
• Members expressed concerns over governance changes, funding models, and the proposed merger of ESAs.
• The draft was to be amended and re-submitted for approval via written procedure.

Agenda Item 15: Prudential Regime of Investment Firms

• The EBA proposed a new framework for investment firms, categorising them into three classes.
• The K-factor approach for capital requirements was supported, but further calibration and clarification on governance and remuneration were needed.

Agenda Item 16: Data Infrastructure Project – Workstream 1 Report

• The BoS approved the report from Workstream 1 of the data infrastructure project.
• The project's sequential approach was reaffirmed, with the EBA to liaise with the ECB and national CAs to address concerns.

Agenda Item 17: CET1 List 2017 and EBA Opinion on Own Funds

• The updated CET1 list and associated report were approved for publication.
• The EBA Opinion on Own Funds was also adopted, proposing clarifications and enhancements to the CET1 framework.

Conclusion

The BoS meeting covered a wide range of supervisory and regulatory issues, including governance, risk assessment, transparency, stress testing, and data infrastructure. The focus was on maintaining consistency, clarity, and flexibility in regulatory frameworks, while engaging with national competent authorities and international bodies to ensure alignment and effective implementation.