European Parliament Approves CRR “Quick Fix” to Mitigate ...

European Parliament Approves CRR “Quick Fix” to Mitigate Economic Consequences of COVID-19 ... The measures grant relief for EU banks to enhance ... Latham&WatkinsLLP GlobalFinancialRegulatoryBlog InsightsandcommentaryonfinancialregulatoryissuesanddevelopmentsimpactingbusinessandinnovationintheUS,theUK,Europe,Asia,andotherpartsoftheworld. MenuHome AboutUs Contact Subscribe ThemeasuresgrantreliefforEUbankstoenhancebanklendingtocompaniesandhouseholds. ByAxelSchiemannandDominikSchöneberger On18June2020,theEuropeanParliamentapprovedtheso-calledCRR“quickfix”toRegulation(EU)575/2013(CapitalRequirementRegulation(CRR))andRegulation2019/876(CapitalRequirementRegulation2(CRR2))tomitigatetheeconomicconsequencesofCOVID-19.Thetemporarymeasuresare,interalia,intendedtoenhancecreditflowstocompaniesandhouseholds,therebysupportingtheEU’seconomy. Thekeychangesinclude: MorefavorableprudentialtreatmentofSMEandinfrastructureexposuresaswellasloanstopensionersandemployees(withapermanentcontract)backedbytheborrower’spensionorsalary.ThechangeswouldhavebeenimplementedunderCRR2middleofnextyearanywayandarenowimplementedearly. GuaranteesprovidedinthecontextoftheCOVID-19pandemicbynationalgovernmentsorotherpublicentitieswillbetreatedmorefavorablyforpurposesofminimumcoveragerequirementsundertheCRR. Theapplicationoftheleveragebufferrequirementforgloballysystemicallyimportantinstitutions,implementedbyCRR2,isdeferredbyoneyearto1 January2023. ThetransitionalarrangementsformitigatingtheimpactonownfundsoftheintroductionofIFRS9havebeenextendedbytwoyears. Thepossibilityofexcludingcertainexposurestocentralbanksfromthecalculationofaninstitution’stotalexposuremeasurewasadvanced,andtheoffsettingmechanismhasbeenmodified. TheCRR“quickfix”ispartofaseriesofmeasurestakenbytheEuropeanUniontomitigatetheeconomicimpactoftheCOVID-19pandemicacrosstheMemberStates.ThemeasuresalsoincludeaCommissionInterpretativeCommunicationontheapplicationofaccountingandprudentialframeworkstofacilitateEUbanklending,aswellasquestionsandanswersforCOVID-19-relatedmeasures. Forfurtherdetails,pleaserefertothetextasadoptedbytheEuropeanParliament. Submitacommentaboutthisposttotheeditor. Topics BenchmarkRegulations CapitalandLiquidity ClearingandSettlement ConductofBusiness Derivatives Environmental,SocialandGovernance(ESG) FinancialCrime FintechandCryptocurrency IndividualAccountabilityandGovernance MarketMisconduct MarketsandInvestments Payments RecoveryandResolutionPlanning RegulatoryReform RetailMarkets SecuritiesRegulation StayConnectedSubscribeArchivesArchives SelectMonth December2021 November2021 October2021 September2021 August2021 July2021 June2021 May2021 April2021 March2021 February2021 January2021 December2020 November2020 October2020 September2020 August2020 July2020 June2020 May2020 April2020 March2020 January2020 November2019 October2019 August2019 July2019 June2019 May2019 March2019 February2019 December2018 October2018 September2018 August2018 July2018 June2018 May2018 April2018 March2018 February2018 December2017 November2017 October2017 September2017 July2017 June2017 May2017 RecentUpdates SECStaffIssuesKeyConsiderationsonLIBORTransition UKFCAPublishesDetailedPlansforNewConsumerDuty ReviewofUKAppointedRepresentativesRegimetoIncreaseBurdenonPrincipalFirms UKFCAConfirmsNewRulestoRemoveBarrierstoListing FCALaunchesDiscussiononSustainabilityDisclosureRequirementsandProductLabels UK [email protected] [email protected] [email protected] [email protected] [email protected] Germany MarkusKrü[email protected] [email protected] France [email protected] US [email protected] [email protected] [email protected] [email protected] APAC [email protected] [email protected] ©2021,Latham&WatkinsLLP Strategy,design,marketing&supportbyLexBlog