ESMA has published the update of its Q&A on:
Since the publication of the last updated list of CET1 capital instruments on 8 December 2021, the EBA has continued monitoring and assessing the capital instruments issued by EU institutions and their eligibility towards the criteria set in the CRR. A new type of instruments issued by Spanish investment firms has been added as it was assessed and evaluated as compliant with the CRR. According to the Spanish national law, this type of instrument may only be issued by investment firms and, therefore, a dedicated mark has been introduced to highlight this limitation. For ease of reference, a new row has been added and highlighted to flag this new instrument.Following the Joint Committee EEA Decision adopting the CRR1 that entered into force on 1 January 2020, the EBA assessed all types of CET1 instruments issued in the EEA counties in order to add them to the CET1 list. Given that all instruments were considered as fully compliant with the eligibility criteria set out in the CRR, the instruments are now included in the updated CET1 list and new highlighted rows have been added to flag these instruments.Furthermore, a few instruments no longer used by institutions have been deleted in order to reflect only instruments used in the EU or EEA on the list. Finally, a few minor amendments have been introduced in the column referring to the national provisions in order to mirror legislative changes or to provide further clarifications.For the purpose of correctly reading this list, the EBA recommends taking into account the caveats described in the intro section of the list.
Although the EU banking system proved overall resilient, the ample support provided does not give room to complacency, and the framework is to be further strengthened with a loyal and prompt implementation of Basel III. The publication is accompanied by an update to the list of public guarantee schemes (PGS) and general payment moratoria schemes issued in response to the pandemic. Finally, the EBA Guidelines on Covid-19 reporting and disclosure have been repealed in response to the decreasing relevance of the related public support measures, and the overall EBA proportionate approach to reporting.
The objective of the draft ITS is to provide a common data standard for the NPL sales or transfers across the EU enabling cross-country comparison and thus reducing information asymmetries between the sellers and buyers of NPL, thus improving the functioning of NPL secondary markets. The draft ITS are built around the templates to be used for the provision of loan-by-loan information for the sales or transfers of NPL portfolios. The templates cover information regarding counterparties related to the loan, contractual characteristics of the loan itself, any collateral and guarantee provided, any legal procedures and enforcement procedures in place, and the historical collection of loan repayment. The NPL transaction data templates are also complemented by a data glossary and the instructions for filling in the templates. The draft ITS are based on strong proportionality arrangements, focusing on the sales of portfolios of NPL and setting different information requirements depending on the nature of the borrowers and of the loans included in the portfolios to be sold, by specifying mandatory data fields. Proportionality is further reinforced by allowing all data fields to be treated as not mandatory for certain types of transactions. These draft ITS have been submitted to the European Commission for adoption.
