EU-wide Stress Testing of Banking Sector
On April 29, the European Banking Authority (EBA) published its methodology and adverse macroeconomic scenario (dated April 17) for the 2014 EU-wide stress test. It also published scenarios relating to market risk and securitization.
The test is designed to assess banks' resilience to hypothetical external shocks, identify remaining vulnerabilities in the EU banking sector and provide a high level of transparency into EU banks' exposures. The EBA's accompanying press release outlines the key features of the methodology and the scenario. The common methodology underlying the assumptions cover a wide range of risks including credit and market risks, exposures towards securitization, sovereign and funding risks.
The EBA's FAQs provide a useful reference for the stress tests. Methodology. Scenario. Market Risk. Securitization. Press Release. FAQs.
Further Charges in LIBOR Investigation
On April 28, the Serious Fraud Office (SFO) published a press release announcing that three former employees of Barclays Bank plc have been charged with offenses of conspiracy to defraud in connection with the SFO's investigation into the manipulation of the London Interbank Offered Rate. Press Release.
European Parliament's First Reading of MiFID II Directive
The Council of the EU published an information note dated April 22 from the General Secretariat of the Council to the Permanent Representatives Committee and the Council concerning the outcome of the European Parliament's first reading of the proposed MiFID II Directive. On April 15, the Parliament voted in plenary to adopt the MiFID II Directive at first reading, together with MiFIR. The note states that the Parliament's first reading position affects what had been previously agreed upon between the institutions, and that the Council should therefore be in a position to approve the Parliament's position. The MiFID II Directive can then be formally adopted in the wording corresponding to the Parliament's position. Note.
FCA Updates AIFMD Web Page
The Financial Conduct Authority (FCA) has updated its "latest news" Web page on the Alternative Investment Fund Managers Directive (AIFMD) with additional information relating to authorization applications made by firms managing alternative investment funds during the one-year transitional period ending on July 22, 2014. Web Page.