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Welcome to our Friends weekly e-mail.Highlights of my week: The legislative activity of the Ninth European Parliament closes this week – with more than 100 plenary votes, including many on financial dossiers. ECON also signed off a number of dossiers but these are not binding on the next ECON. The European Council also reached a number of Conclusions on CMU items - insolvency, securitisation, supervision of capital markets, equity investment, financial literacy - but the leaders’ hypocrisy will probably be on display in the next year or two when their junior ministers are permitted to obstruct the measures just welcomed! However, the issue of re-starting securitisation at scale is now inescapable – as a means of managing banks’ balance sheets but also offering competition to them. The `Letta’ report was widely welcomed and may have provided a key trigger to progress on CMU. Indeed, Chancellor Scholz called for deepening CMU and Bundesbank President Nagel supported European deposit insurance –– despite his government’s opposition to `EDIS’. However, professional associations continue to temper their welcome for legislative progress with detailed criticisms on say Solvency II and the Retail Investment Strategy. The ISSB will now turn its attention to nature and human capital -related disclosures. However, a senior head-hunter cast an interesting light on asset managers’ ESG enthusiasm by reporting the surge in senior ESG staff looking elsewhere. POLITICO highlighted the damage done to the City of London’s green ambitions by the Tories’ `flip-flopping’ on the issue. Goldman Sachs quietly moved one of its most senior bankers from London to Paris. Graham Bishop Articles from 18-25 April 2024
Policy impacting Finance Parliament: Final plenary votes on economic and financial matters : This plenary session (22-25 April), has ratified numerous informal deals reached between negotiators on files dealing with economic or financial services matters. These deals must now also be confirmed by the Council, after which they will be published in the EU's official journal and become law. View Article
Parliament: Texts adopted by plenary on economic and financial matters – first reading closed : European Parliament has adopted its position for opening negotiations with the MS during the next legislature. The MEPs of the next ECON remain free to choose whether to open negotiations based on the negotiating mandate as adopted or whether to draw up a new negotiating mandate. View ArticleEURACTIV: Morawiecki, Orbán plot reshuffle in EU Parliament with Le Pen : Hungarian Prime Minister Viktor Orbán and former Polish prime minister Mateusz Morawiecki, members of the right-wing ‘national-conservative’ camp, are planning a reshuffle of powers in the European Parliament in an attempt to gain enough leverage in the next term. View Article
European Council conclusions, 17 and 18 April 2024 : Conclusions on CMU: insolvency, securitisation, supervision of capital markets, equity investment, financial literacy View Article
Remarks by President Charles Michel following the Special European Council meeting of 17 and 18 April 2024 : We have provided fundamental guidance on three extremely important topics. We are perfectly clear on this, which is a testament to the quality of the decisions and steps forward that have been taken. First, we are taking a major step forward..towards harmonising .. bankruptcy frameworks View ArticleBankenverband: Scholz: Capital markets union vitally important : Chancellor Scholz called for substantial progress on deepening capital markets union. He said that banks and international financial investors were willing to invest but were too often prevented from doing so because the capital markets in Europe are organised at the national level. View Article
AFME reaction to the European Council’s recommendation for a new EU competitiveness deal and the Letta report on a new Single Market : The European Council’s call to deepen the Single Market and advance the Capital Markets Union as part of this new deal is, in AFME’s view, key to securing a globally competitive EU economy as well as the EU’s long-term prosperity. View ArticleThe European Banking Federation supports the vision of Enrico Letta on the Future of the Single Market : We took the opportunity to provide our views on how to strengthen the EU single market with respect to the integration and development of Europe’s capital markets to serve the needs of Europe’s innovative companies, its citizens and the prosperity of its economy in general. View Article
EuropeanIssuers Welcomes Enrico Letta’s High-Level Report on the Single Market : EuropeanIssuers advocates, in accordance with the Report, for greater emphasis to be placed on the implementation of the proposals drafted by the ending legislative cycle. In synergy with a swift achievement of the Capital Markets Union... View Article
ECIPE's Erixon: The Letta Report – the Good and the Bad! : It has been billed as a bold plan for reviving the single market and make it more consequential for Europe’s economic performance. While there are some truths to that, I would say that the Letta report is more significant for its political realism than its economic ambitions. View Article
CER's Berg/Meyers: Enrico Letta's report: More than a market, but less than an agenda : Enrico Letta’s report on the single market offers largely sensible ideas to strengthen the EU’s economy. But he leaves member-states the job of prioritising and tackling the trade-offs. View Article
EURACTIV: New EU debt? Conservative think-tank warns of NextGen ‘design flaws’ : In the debate about a programme that could succeed the EU’s Recovery and Resilience Facility (RRF), a think tank close to the centre-right EPP has criticised “significant flaws” in the current scheme, including the lack of a plan for repaying the joint EU debt. View Article
Banking Union Parliament: New EU rules to combat money-laundering adopted :The new laws ensure that people with legitimate interests will have free access to beneficial ownership information held in national registries and interconnected at EU level. A new Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) will be established in Frankfurt. View Article
AFME welcomes European Parliament’s position on Crisis Management and Deposit Insurance Framework : AFME welcomes today’s European Parliament vote on its position as progress in the right direction, but needing further clarifications and refinement. These are goals we hope can be achieved as the Council agrees on its general approach and co-legislators begin negotiations. View Article
The EBA consults on draft technical standards on the specification of long and short positions under the derogations for market and counterp : The Capital Requirements Regulation (CRR) includes some derogations for the calculation of the capital requirements for market and counterparty credit risks, for small trading book business, derivative business or business subject to market risk. View Article
SSM's Tuominen: Exchanging perspectives for better bank governance -“Governance and risk culture: going forward by looking back” : All banks need good governance and a sound risk culture to take the right decisions. We saw in the global financial crisis and in last year’s banking sector turmoil that deficiencies in internal governance and risk culture can often be early warning signs of turbulence ahead. View Article
ECB's Cipollone: Innovation, integration and independence: taking the Single Euro Payments Area to the next level : SEPA has fallen short when it comes to digital payments that are even more central to our daily lives: there is no SEPA at the point of interaction, namely for in-store, mobile or e-commerce payments. View Article
Bankenverband: Nagel: European deposit protection would have many advantages : ..he believes the introduction of a European Deposit Insurance Scheme (EDIS) could make the eurozone overall more resilient. It would relieve the burden on national insurance schemes in the event of a crisis, strengthen customers’ trust in banks and it would relieve the member states as a whole.. View Article
ESBG provides feedback on EBA public consultation on RTS on Prudent Valuation : The European Savings and Retail Banking Group (ESBG) recently submitted its response to the latest European Banking Authority (EBA) consultation on Regulatory Technical Standards (RTS) on prudent valuation, building on relevant technical input submitted by members View Article
Capital Markets Union EFAMA: European Parliament proposes measures that significantly improve the Retail Investment Strategy : ...the European Parliament position ensures that individual investors maintain access to personal, professional and affordable financial advice. At the same time, it guarantees that the right steps are taken so that products and services offer value to investors. View Article
PCS: And the support kept rolling in from everywhere... : In the past few months, the revival of a safe and strong securitisation market as a key priority for Europe's future has received high level support from numerous directions,... View Article
Bankenverband: Lindner: Revitalising the EU securitisation market : View ArticleInsurance Europe: Mismatched: insurers request clarity on timeline to implement EU resolution law : The insurance industry has called on the EU to publish a clear and coherent roadmap for the development of the Insurance Recovery and Resolution Directive (IRRD). In a position paper released the day of a European Parliament vote on the IRRD.. View Article
Insurance industry: EU must stay on course to deliver Solvency II : Insurance Euroope welcomed the changes agreed by the EU co-legislators that reduce current excessive solvency requirements and unlock capital. This increases the capacity for the industry to provide more protection for citizens and businesses and investment into the European economy. View Article
ESMA proposes changes to ELTIF Technical Standards : In the letter ESMA suggests that there should be a limited number of changes to find the right balance between protecting retail investors and contributing to the capital market union objectives. View Article
Environmental, Social, Governance (ESG) ISSB to commence research projects about risks and opportunities related to nature and human capital : ..the ISSB will look at how it might build from relevant pre-existing initiatives. This includes those already under its purview—the SASB Standards and CDSB guidance—and, additionally, relevant aspects of the work of the Task Force on Nature-related Financial Disclosures (TNFD). View Article
UNEP FI: Net-Zero Asset Owner Alliance’s Target-Setting Protocol Fourth Edition affirms : 1.5ºC ambition for 2030 portfolios ahead of real economy progress. Latest protocol expands to cover all private assets, making it one of the most comprehensive target-setting guidance from a voluntary initiative to date. View Article
IPE's Robinson-Tillet: ESG employees disillusioned as asset managers lose enthusiasm, says headhunter : There has been a surge in senior ESG specialists looking for new roles after realising their employers aren’t as serious about sustainability as they claimed, according to a headhunter in the space. View ArticleEBF Response to the EBA Consultative Document Guidelines on ESG risks management : A gradual approach should be envisaged in the Guidelines, starting with environmental considerations given their maturity level compared to S&G factors, as well as the fact that risks related to S&G factors are not comparable to environmental factors as a channel of materialization of financial risk. View Article
FCA confirms anti-greenwashing guidance and proposes extending sustainability framework : Ahead of the anti-greenwashing rule coming into force on 31 May, the FCA is supporting industry with guidance to help them meet the standard. View Article
FBF: French banks are stepping up their efforts in the fight against climate change, with a 50% increase in their green and sustainable lend : with a 50% increase in their green and sustainable lending. For every euro of fossil fuel financing, €5 now goes to funding the transition View Article
Fin Tech Regulation ALFI responds to the ESMA’s consultation on the qualification of crypto assets as financial instruments, under MiCA : The proposed guidelines aim at providing guidance on the qualification of crypto-assets as financial instruments that national competent authorities and market participants should consider.. View Article
ALFI responds to the ESMA’s consultation on the proposed guidelines on reverse solicitation and similar aspects in the scope of MIFID II, : ALFI generally agrees with the proposed content of the guidelines. We appreciate the underlying purpose of these guidelines is to foster investor protection and we are in favour of the proposed regulatory convergence with the corresponding provisions under MiFID II. View Article
‘Big Tech a priority’ says FCA Chief Executive : The FCA's Chief Executive Nikhil Rathi announced the regulator's plans to examine how Big Tech firms’ unique access to large sets of data could unlock better products, more competitive prices and wider choice for consumers and businesses. View Article
Brexit and the City The City UK: International benchmarks needed to fully assess regulators’ impact on competitiveness and growth : New research by TheCityUK and Freshfields Bruckhaus Deringer shows that the UK financial regulators’ metrics to track progress against their secondary objective for competitiveness and growth will provide world-leading transparency and accountability. View Article
POLITICO: Flip-flopping Tories freeze City of London’s green ambitions : Conservatives want to make electoral hay — but without the right rules and regulations, the City could fall behind. View Article
FT: Goldman Sachs moves senior banker to Paris in post-Brexit revamp : Head of financial institutions group for Europe relocates at sensitive time for its operations on the continent View Article
Brexit Will the UK’s rejection of EU overtures on youth mobility last? : Brussels’ offer to open talks has been rebuffed but the prospect of a deal is still possible, say experts View Article
FT: UK exports of services have grown 9 times faster than goods since 2010 : Economy’s shift away from manufacturing may have been accelerated by Brexit, some experts argue View Article
FT's Foster: UK veterinary deal with EU could boost agrifood exports by 22%, study finds : Since Brexit, food and drink industry has faced border checks on business with largest trading partner View Article
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