( Only in Italian)
The data indicate that banks are benefitting from the economic recovery with RoE remaining broadly similar to the previous quarter. Capital ratios remained stable and there was a further decline in NPL ratios. Operational risks remain elevated mainly due to cyber and ICT related risks.
EIOPA has published two Opinions on the supervisory reporting of costs and charges by Institutions for Occupational Retirement Provisions (IORPs) and the risk assessment of IORPs that provide defined contribution (DC) schemes.
Costs and charges can have a substantial cumulative impact. In order to protect members and beneficiaries, a transparent and comprehensive view of all costs and charges is essential for IORPs, social partners and supervisors. To address this, the Opinion sets out expectations on the supervisory reporting of costs and charges of IORPs. It provides a classification of costs to be reported to national supervisors and introduces a practical guidance for supervisors and IORPs – complete with reporting templates – on how to collect data. It lays out principles for the compilation of cost information and stipulates that not only direct but also indirect costs incurred by asset managers and investment funds should be reported.
Members are more likely to suffer adverse consequences if risks crystallise in defined contribution (DC) pension products compared with defined benefit products. The supervisory approach to DC products needs to ensure that risks borne by DC IORPs are appropriately monitored and managed. The Opinion fosters consistent supervisory practices by providing guidance on two aspects of risk management by DC IORPs:
- the Opinion calls for a greater use of quantitative elements when managing operational risks;
- it expects DC IORPs to conduct long-term risk assessments by using projections of members’ future retirement income, comparing the results with the established risk tolerance of the members and beneficiaries, and as appropriate considering the IORP’s investment strategies.
