CUBE RegNews: 13th March

Greg Kilminster

Greg Kilminster

Head of Product - Content

FIA announces Cyber Risk Taskforce at CFTC meeting 

The Futures Industry Association (FIA) has announced the formation of a Cyber Risk Taskforce to examine the longer-term implications for cleared derivatives markets. FIA president Walter Lukken said the taskforce will be global in focus, and initial work will focus on existing cyber protections and protocols, the effectiveness of the industry’s initial response, best practices around reconnection, and safeguards around third-party service providers. 

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EBA publishes annual assessment of banks’ internal approaches for the calculation of capital requirements 

The European Banking Authority (EBA) has published its Reports on the annual market and credit risk benchmarking exercises conducted in 2022. The annual benchmarking exercises aim to improve the regulatory framework, increase convergence of supervisory practices and, thus, restore confidence in internal models. The exercises also provide a regular supervisory tool based on benchmarks to support competent authorities’ assessments of internal models and produce comparisons with EU peers. 

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ECB speech on digital finance 

Elizabeth McCaul, Member of the Supervisory Board of the European Central Bank (ECB) spoke on supervision and regulation of digital banking. In the speech she noted ECB forthcoming plans to look at: “governance, technological and operational aspects, banks’ overall strategies and the impact they have on business models and profitability, and we will focus on answering a number of questions, including: how does a bank’s internal governance framework support the development and implementation of digital transformation strategies? Are the banks’ risk management frameworks equipped to deal with the potential rise in IT, cyber and operational risks? How do banks manage their third-party risk? Do banks ensure adequate data quality and data aggregation for proper risk governance and sound risk-based decision-making, also for their digital transformation strategies?”

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US Treasury, Federal Reserve, and FDIC act on strengthening confidence in banking system 

Following the latest concerns regarding Silicon Valley Bank (SVB), the joint press release announces that all SVB customers will have their deposits fully protected. The release says a similar scheme will be put in place for customers of Signature Bank in New York, which has also been closed by its state chartering authority. 

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BoE publishes paper on climate-related disclosures 

The Bank of England (BoE) has published its new Staff Working Paper, Understanding Climate-related Disclosures of UK Financial Institutions. The paper focuses on climate-related disclosures of financial sectors, namely banks and insurers. The paper concludes that “climate-related disclosures by UK banks and insurers have increased over time with significant jumps of disclosures in 2019 and 2020. This increasing trend in disclosures is uniform across all TCFD (Task Force on Climate-Related Financial Disclosures) themes and across both sectors. However, there is still a significant number of firms that do not disclose any information.” 

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REPO freezes nearly £50bn in Russian assets 

An update from the Home Office and Treasury confirmst that, a year since the Ukraine invasion, the Russian Elites, Proxies, and Oligarchs (REPO) Task Force has frozen nearly £50billion in Russian assets. The Task Force continues to leverage financial intelligence, law enforcement information, joint investigations, and the assistance of the private sector to deny the Kremlin access to the revenue streams and economic resources Russia uses to wage its war against Ukraine.

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