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EU Parliament ‘likely’ to allow market risk capital relief
MEPs propose allowing supervisors to temporarily exclude Covid-related backtesting exceptions
ECB’s Enria unsure banks will dip into capital buffers
Anxiety over investor and rating agency reaction may limit banks’ use of Covid relief measures
European lawmakers urged to prevent CCP contagion risk
Watchdog says carve-out needed in new recovery and resolution rules to avoid cascading default of clearing houses
Latest
Quotes
What the market would not like to see is spot FX brought under an investment-type regulatory framework, because you never know where that’s going to end up
David Clark, European Venues and Intermediaries Association
The onus will always be on the bank to provide a justification for the committed quotes they count as verifiable prices for the purpose of the risk factor modellability assessment
Stephane Boivin, European Banking Authority
At the moment we are relaxed because not much is going on, but if things go off like they did in March and if our clearer doesn’t have room, then for no [logical] reason we may have to stop trading
Risk officer, European proprietary trading firm
Editor's Choice
Leaked EU document casts doubt on leverage ratio relief
Several MEPs oppose leverage exemption for sovereign bonds, but some want SA-CCR fast-tracked
Big Figure
No deal, off-limits
If the UK ends its Brexit transition period on 31 December 2020 without a deal on financial services equivalence, credit risk capital requirements for UK bank exposures to lower-rated EU banks could jump by up to fivefold, making trades between these counterparties uneconomical.
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Climate charges, CCP contagion and the post-Libor world
The week on Risk.net, May 23-29, 2020
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Comment
Now is not the time to change the rules on CCP resolution
Regulatory lenience over Covid-19 must be carefully judged
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