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FCA publishes its second set of rules following its Asset Management Market Study

04 February 2019

The Financial Conduct Authority (FCA) has published new rules and guidance to improve the quality of the information available to consumers about the funds they invest in. The asset management industry plays an important role in the UK’s economy. Asset managers seek returns for investors by investing in a variety of assets.  Over £1 trillion is managed for individual investors and £3 trillion on behalf of UK pension funds and other institutional investors. The FCA’s asset management market study presented evidence of weak price competition in many areas of the asset management industry. This means lower returns for savers, pensioners and other investors. Continue reading…

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Why we must complete banking union – financial stability threats would hit citizens’ trust

31 January 2019

Following the 2008 crisis, reforms were needed in Europe’s financial sector. The establishment of the single rulebook and the launch of the European Union’s banking union with its rules and institutions constitute a commendable success in this regard. The banking union is currently based on two pillars: the Single Supervisory Mechanism and Single Resolution Mechanism. However, since these were put in place, the political will to complete the banking union has waned. Continue reading…

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Risk endogeneity at the lender/investor-of-last-resort

30 January 2019

Bank for International Settlements (BIS) address to what extent a central bank can de-risk its balance sheet through unconventional monetary policy operations. To that end, BIS propose a novel risk measurement framework to empirically study the time variation in central bank portfolio credit risks associated with such operations.

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Shared National Credit review finds some improvement in credit quality, risk remains elevated in leveraged loans

29 January 2019

Federal banking agencies find that risk in the portfolio of large syndicated bank loans has declined, due to improving conditions in most sectors. Despite the improvement, the dollar volume of loans rated below “pass,” as a percentage of total loans, remains elevated compared with levels experienced in prior economic cycles, according to the Shared National Credit (SNC) Program Review. Continue reading…

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Committee on the Global Financial System report outlines ways to boost domestic capital markets

25 January 2019

Policymakers and stakeholders can do more to promote the development of robust and efficient capital markets, according to a new report by the Committee on the Global Financial System (CGFS). Establishing viable capital markets finds that large differences persist in the size of capital markets across advanced and emerging economies. Emerging-economy markets have been catching up with their more advanced peers, but the gap has not yet been closed. Continue reading…

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FCA consults on cryptoassets guidance

24 January 2019

The FCA is consulting on guidance, which, once finalised, will set out the cryptoasset activities it regulates. The guidance will help firms understand whether their cryptoasset activities fall under FCA regulation. Firms will have a better understanding of whether they need to be authorised and can ensure they are compliant and have appropriate consumer safeguards in place. The consultation is in response to industry request for greater clarity, and to the Cryptoasset Taskforce’s recommendation that the FCA provides additional guidance on the existing regulatory perimeter. Continue reading…

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Luxembourg and broadcasting

23 January 2019

by Vincent Wellens

Since the UK Parliament has rejected the Withdrawal Agreement between the EU and the UK on 15 January 2019, a so-called “no deal” scenario becomes a bit more likely. It goes without saying that this has a tremendous impact on the broadcasting sector as it is one of the sectors to typically benefit from the “country of origin”-principle under EU law. A broadcasting company having an establishment in one EU/EEA Member State can, by virtue of Article 3 of the 2010 EU Audiovisual Media Services Directive (“AVMSD”), freely broadcast into all other EU/EEA Member States. The latter can only intervene in very exceptional circumstances (in case of a serious risk for public health and public security). Continue reading…

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EBA publishes final guidance regarding the exposures to be associated with high risk

22 January 2019

The European Banking Authority (EBA) published its final Guidelines regarding the types of exposures to be associated with high risk under the Capital Requirements Regulation (CRR). Through these Guidelines, the EBA aims not only to enable a higher degree of comparability in terms of current practices in identifying exposures associated with high risk, but also to facilitate the transition to the upcoming regulatory revisions, noting that the forthcoming implementation of the revised Basel standards will only apply as of 2022. Continue reading…

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Crypto-assets need common EU-wide approach to ensure investor protection

21 January 2019

The European Securities and Markets Authority (ESMA) publishes its Advice to the European Union (EU) Institutions – Commission, Council and Parliament – on initial coin offerings and crypto-assets. The Advice clarifies the existing EU rules applicable to crypto-assets that qualify as financial instruments, and provides ESMA’s position on any gaps and issues in the current EU financial regulatory framework for consideration by EU policymakers.

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