New provisions on remuneration and incentivization policies and practices
The prudential regulation for banks and investment companies has been updated, by introducing new provisions on remuneration and incentivization policies and practices in banks and in bank groups. This Regulation will come into force on the fifth day following its publication in the Official Journal of the European Union
Consultation on amendments to Circular letter no. 262
The Bank of Italy has started a public consultation concerning amendment proposals to Circular letter no. 262 and to the Order dated 30 November 2018, which regulate the schemes and rules for the preparation of the financial statements of banks and IFRS intermediaries other thank bank intermediaries.
Remarks and comments can be sent by 22 August 2021.
Notifications and supervisory reporting
The EBA has published a consultation document titled “Consultation Paper on the ITS on Supervisory Reporting regarding COREP, AE and GSIIs”, whose aim is to:
Simplify the notification of asset encumbrance for small and non-complex entities
Change COREP securitization and G-SII reporting
The consultation is valid to 23 September 2021.
Evaluation of ESG risks
A report of the EBA provides entities with a series of common definitions of ESG risks and of the relevant submission channels and identifies the evaluation methods required for an efficient risk management. The EBA recommends a prompt integration of ESG risks into business strategies, governance and risk management, as well as supervision.
The Report provides a complete proposal on how ESG factors and ESG risks should be included in the regulatory and supervisory framework for credit institutions and investment companies.
Adjustments for credit risk through the standardized method
The EBA started a public consultation on the amendment of its regulatory technical standards (RTS), concerning the amendments for the credit risk within the calculation of the risk weight (RW) of defaulted exposures under the Standardised Approach (SA). The consultation will be open until 24 September 2021
Amendment to FINREP notifications
The European Central Bank has implemented a number of amendments to the definition and structure of some templates within the annexes of the FINREP regulation.
Methods for derivatives
The European Commission published the regulation on the prudential requirements for credit institutions and investment firms, amending Regulation (EU) no. 648/2012.
It defines the method to identify derivatives transactions with one or more significant risk factors, the formula to calculate the supervisory delta of call and put options associated to the interest rate risk category and the method to determine whether a transaction is a short or long position in a primary risk factor, or in the most significant risk factor within a certain risk category, in the standardized approach for counterparty risk.
Economic downturn
The European Commission published Delegated Regulation (EU) no. 2021/930 concerning the regulatory technical standards specifying the nature, severity and duration of an economic downturn. These have been effective as of 1st January 2021.
SREP Review
SREP reviews, established by the European Commission, aim to implement the recent amendments to the Capital requirements directive (CRD V) and to the Capital requirements regulation (CRR II), and to align with other regulatory developments and with better supervision practices. The current review of SREP directions concerns all of the main SREP elements, including:
The deadline for the submission of comments is 28 September 2021.
ITS on new supervision approaches concerning investment firms.
The EBA document titled “Final report on draft ITS on supervisory disclosure for competent authorities of investment firms” concerns information on supervision approaches and on aggregate statistical data related to new prudential requirements, which public authorities will have to disclose to all investment firms authorized pursuant to the Markets in financial instruments (MiFID).
Domestic supervisory authorities will have to disclose such information as of June 2022.
Market infrastructure based on distributed ledger technology
The ECB issued an opinion in which it welcomes the Proposal for a Regulation, aimed to allow investment firms, market operators and central securities depositories (CSD), to manage market infrastructures based on distributed ledger technology (DLT), both as a multilateral DLT system and as a system for the regulation of transactions with DTL or with DLT negotiation multilateral systems.
Information for the cross-border distribution of undertakings for collective investments
In order to facilitate the cross-border distribution of undertakings for collective investments, the European Commission has introduced some amendments to models, patterns, procedures and technical provisions for the publication and notification of commercialization rule, of expenses and of charges and specifies the information to be notified for the creation and management of the central database relevant to the cross-border commercialization of AIFs and UCITS, as well as to models, patterns and procedures for the notification of such information.
Better individual and businesses protection strategies for the access to new digital financial services.
The G20 working group for financial inclusion (Global Partnership for Financial Inclusion – GPFI) defined that at the end of the year, the Italian presidency will provide a list of the best strategies implemented by the G20 Member states in order to
New Data Breach procedure.
The Data Protection Supervisor issued an order providing that the new data breach notification procedure will be effective as of 1st July 2021.
The Italian Financial Intelligence Unit has published no. 4 of the series Working papers on anti-money laundering, concerning money laundering and terrorism financing cases
The document of the FIU aims to provide those subject to active collaboration obligations with a number of most recent cases identified by the FIU through the reporting of suspicious transactions, inspection assessments, information exchange with foreign Financial Intelligence Units or through the cross analysis of available databases.
FIU annual report
The 2020 report shows an increase in the number of notifications of suspicious transactions.
It also shows a strengthening of contacts with public administrations through the collaboration with the National Anti-mafia Direction, Guardia di Finanza, and the Anti-Mafia Investigation Directorate.
Second meeting of the SFWG on sustainable finance
The second meeting of the SFWG was held on 18 June 2021, in order to continue the activities on the development areas outlined for 2021 (sustainability reporting, approaches to identify sustainable investments, and the role of international financial institutions to facilitate the achievement of the objectives set by the Paris Agreement) and start a discussion on the multi-year roadmap on sustainable finance.
CONSOB analysis on sustainability
The CONSOB document collects the results of the analyses carried out within the Steering Committee on sustainability, created to promote regulation and supervision interventions attributed to the institution. Such document analyses the following subjects:
ABI-CIPA: Artificial intelligence in banks.
The Italian Banking Association (ABI) and the Interbank Convention on Automation (CIPA) published a document titled “Reporting on IT in the Italian banking sector – Artificial Intelligence in banks: state of the art and perspectives”, concerning Artificial Intelligence (AI) in the banking sector.
Agency for Cybersecurity
The Council of Ministers has established the Agency for national cybersecurity, which will also act as National authority for the certification of cybersecurity.
World Investo Week 2021
The World Investor Week (from 4 to 10 October 2021) is a global campaign aimed to increase awareness on the importance of education and protection of investors and to promote the initiatives carried out by regulators in those two areas. Key messages of the 2021 campaign concern two basic issues: i. Sustainable finance, and ii. Prevention of frauds
Transparency for Crowdfunding
The EBA started a consultation on new RTSs concerning the specific information that the providers of crowdfunding services who offer the management of individual loan portfolios need to disclose to investors in relation to the credit risk evaluation method and on each individual portfolio.
RTSs also specify the policies procedures and organization provisions that the providers of crowdfunding services need to implement in relation to any emergency fund that they can offer to investors.
The document also establishes the information that crowdfunding platforms need to disclose, referring to some key characteristics of each loan included in a certain portfolio.
Confindustria Guidelines for Confindustria 231/2001 Models
The new Confindustria guidelines for 231/2001 Models are characterized by the following main updates: