EBA欧洲银行-EBA-BS-2017-076rev1-28Final-Minutes-BoS-14-15-February-2017-FOR-PUBLICATION29_18页_572kb

EBA Board of Supervisors – Final Minutes Summary (14-15 February 2017)

Core Content

The EBA Board of Supervisors (BoS) met in London on 14-15 February 2017 and reviewed a range of agenda items, including Brexit implications, non-performing loans (NPLs), supervisory benchmarking, stress tests, reporting requirements, and regulatory guidelines. The meeting aimed to ensure regulatory consistency and address key challenges in the European banking sector.

Main Points and Key Information

Agenda Item 1: Welcome, Approval of Agenda and Minutes

• The BoS approved the agenda and minutes from the previous meeting (6-7 December 2016).
• Noted changes in voting members for Latvia, Finland, and the Czech Republic.
• The Chairperson highlighted the need to prepare for Brexit discussions and mentioned the Commission’s planned public consultation on ESA review.

Agenda Item 2: Election of Members of the Mediation/Breach of Union Law Panel

• Five full members were appointed to the Mediation Panel: Helmut Ettl (Austrian Financial Market Authority), Fernando Vargas (Bank of Spain), Andrzej Reich (Polish Financial Supervision Authority), Pedro Duarte Neves (Bank of Portugal), and Édouard Fernandez-Bollo (French Prudential Supervisory and Resolution Authority).
• No applications were received for three alternate positions.
• The EBA proposed a new call for alternates, especially from countries not in the Banking Union.
• A discussion on the representation of resolution authorities in the Panel was suggested for the upcoming BoS meeting in May 2017.

Agenda Item 3: Update on Risks and Vulnerabilities

• The EBA Director of Oversight presented an overview of risks and vulnerabilities in the European banking system.
• Key issues included:
  • NPLs: Modest decline, but insufficient to support long-term profitability. Resolution remained low.
  • Capital and Profitability: CET1 ratios increased, but profitability was still subdued.
  • Regulatory Impact: IFRS 9 and MREL requirements could affect capital and provisioning.
• Proposed Solutions:
  • Establishing an EU Asset Management Company (AMC) or a national AMC model.
  • Ensuring that NPLs are transferred at real economic value with full data transparency.
  • No burden sharing across EU countries; BRRD and state aid rules remain applicable.
• Recommendations:
  • Further investigation into clawback clauses, BRRD compliance, and macro-micro supervision.
  • Consideration of different business models and strategies for addressing profitability.

Agenda Item 4: Supervisory Benchmarking Exercise 2016

• The EBA presented results of the 2016 benchmarking exercise on credit and market risk.
• Concerns were raised about the methodology and data quality in the executive summary.
• Agreement to provide descriptive statistics and granularity to banks, with a final check by the TFSB.
• The 'global charge' was noted as a challenging metric, but EBA staff defended its utility in comparing IRB and Standardised approaches.

Agenda Item 5: 2018 EU-wide Stress Tests

• The BoS agreed to publish the results in June/July 2018, with a 'tentative' communication to institutions.
• The STTF suggested that starting point data for 2018 stress tests would be restated on an IFRS 9 basis as of 1 January 2018.
• Concerns were raised about the transitional period and the ability of CAs to perform quality checks.

Agenda Item 6: Draft EBA Opinion on Improving the Decision-making Framework for Reporting Requirements

• The EBA proposed amendments to Regulation (EU) No 575/2013 to improve the decision-making framework for reporting requirements, including resolution matters.
• The BoS supported the draft opinion, with agreement to address proportionality, reporting frequency, and minimum requirements for smaller institutions.
• The Commission suggested that the EBA raise the issue in the context of ESA review consultation.

Agenda Item 7: Process Note in view of EBA Opinion on Proposals on CRR/CRD/BRRD

• The BoS agreed to develop formal opinions on key policy topics, including IFRS 9, reporting delegation, and proportionality.
• Topics to be addressed in EBA opinions included own funds, CET1 instruments, intermediate financial holding companies, and Pillar 2.
• The SCRePol would assist in identifying further topics for EBA engagement with EU legislators.

Agenda Item 8: Follow-up to IFRS 9 Issues

• The EBA proposed a static approach for transitional arrangements to IFRS 9, with a phased-in impact over four years.
• Majority supported the static approach, while some preferred the dynamic approach.
• Agreement to consider IFRS 9 provisions as specific credit risk adjustments for institutions using the standardised approach.
• The Commission supported the proportionality approach in the guidelines on expected credit losses (ECL).

Agenda Item 9: Report on the State-of-Play of Basel III Implementation in 2017

• The Task Force on Impact Studies presented the state of Basel III implementation, noting that the report would be finalised with BoS input.
• The report would be published on 28 February 2017 and would include data on MREL, LCR, and LR.
• The Chairperson mentioned upcoming meetings on Basel III reform negotiations in March 2017.

Agenda Item 10: Restricted Session

• A restricted session was held, but no details were provided in the summary.

Agenda Item 11: Annual Report on Functioning of Colleges

• The BoS approved the 2016 annual report on the functioning of EEA colleges and agreed to publish it alongside the 2017 Colleges Action Plan.

Agenda Item 12: Benchmarking Report of Recovery Plans' Options

• The BoS approved the fourth comparative analysis report on recovery plans, focusing on recovery options and their feasibility.
• The report highlighted challenges in linking recovery plans with scenarios and governance.

Agenda Item 13: Consultation Paper on EBA Recommendation on Coverage of Entities in Group Recovery Plans

• The BoS approved the consultation paper on the coverage of entities in group recovery plans.
• A two-year transition period was agreed for migrating from entity-level to group-level recovery planning.
• Concerns were raised regarding the role of host supervisors and the need for more information from subsidiaries.
• The recommendation was to be revisited during the consultation phase, especially regarding parent-subsidiary support in distress.

Agenda Item 14: Progress Update of TFPS Tasks and EBA Opinion on Final RTS on Card Schemes and Processing Entities

• The EBA presented a draft opinion on the RTS for the Interchange Fee Regulation.
• The BoS endorsed the draft, with a review clause agreed for 18 months after adoption.
• The Commission raised concerns about the 'full independence' of card schemes and processing entities.

Agenda Item 15: Final Draft RTS on Strong Authentication and Communication under PSD2

• The BoS approved the final draft RTS on strong authentication and communication under PSD2.
• The EBA introduced a new exemption based on transaction-risk analysis, acknowledging data limitations.
• Additional requirements were added for account servicing payment service providers to ensure TPPs can access necessary data.
• A final editorial review was agreed before submission to the Commission.

Conclusion

The EBA Board of Supervisors made several key decisions and approvals during the meeting, including the appointment of new members to the Mediation Panel, the adoption of opinions on reporting requirements and IFRS 9, and the approval of the 2018 EU-wide stress test timeline. The BoS also endorsed the final RTS on PSD2 and agreed to publish the consultation paper on group recovery plans. Overall, the meeting focused on enhancing regulatory consistency, addressing NPL challenges, and preparing for Brexit-related discussions.