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The Volcker strip – making banking less regulated again

US regulators have disclosed the much awaited revision of the Volcker Rule that had been taken on by the Trump administration. Wall Street has undoubtedly received a huge win, but who is likely to bear the losses? The Volcker Rule was implemented after the financial crash to stop banks from engaging in proprietary trading (buying […]

BRRD 2 “improvements”

Risk magazine reports that the Bulgarian Presidency of the Council of the EU[1] has suggested a reduction in the proposed “BRRD 2” pre-resolution stay period to two days, along with a recommendation that derivatives be included within the power’s scope. The Commission’s November 2017 proposal called for a pre-resolution power of moratorium, enabling national authorities to […]

Prudential Regulators to exempt QFC amends from Margin Rules

On 5 February the five US Prudential Regulators jointly issued a proposal to ensure that certain mandatory amendments to legacy contracts would not trigger their inclusion under the margin regime. The vast majority of jurisdictions contain anti-evasion measures in their margin rules, to the effect that material amendments to pre-margin, legacy trades will act to […]

Multi-tool for bail-in amendments now available

On 1 August 2016, the Association for Financial Markets in Europe (AFME) published a full set of model clauses for the contractual recognition of bail-in under article 55 BRRD. The 55-page package follows the September 2015 release, which was then limited to one jurisdiction. The expanded package now includes: Generic version of model clauses for […]

BRRD Level II OJ’d

The Delegated Regulation (DR) supplementing the BRRD was published in the OJ on the 8 July 2016, having passed consideration by the Council and the Parliament, triggering its entry into force on 28 July 2016. The draft RTS was submitted to the EC by the EBA in December 2015, then adopted by the Commission under its […]

German JMP joins the party

ISDA has today published the German Jurisdictional Module to the ISDA Resolution Stay Jurisdictional Modular Protocol (the ISDA JMP). The ISDA JMP provides a framework to facilitate jurisdiction-specific compliance with contractual stay regulations for contracts governed by third-country laws; its structure and mechanism is reviewed in detail in this blog post. The German Jurisdictional Module […]

ISDA joins Spain to Universal Stay Protocol

ISDA have today published the first Country Annexe to the 2015 Universal Stay Protocol, adding Spain to the list of Protocol-Eligible regimes. The protocol enables adherents to comply with the cross-border application of specified special resolution regimes (SRRs). Protocol Covered Agreements are amended to include a regime-imposed stay on resolution triggered contract termination. The 2015 […]

BRRD Transaction Reporting: Understanding Your Financial Contracts

Introduction On 7 June 2016, the EU Commission adopted a Delegated Regulation (and related Annex) specifying a minimum set of information on financial contracts that must be maintained by institutions and the circumstances in which the requirement should be imposed, as required by Article 71(7) of the Bank Recovery and Resolution Directive[1] (BRRD).  If neither […]

BRRD bares its teeth

Austria yesterday became the first country to exercise full powers conferred by the BRRD. The Financial Market Authority (FMA) as the resolution authority under the Bank Recovery and Resolution Act (BaSAG – Bundesgesetz über die Sanierung und Abwicklung von Banken) applied the following resolution measures to HETA: 100% bail-in of all subordinated liabilities 98% of […]

BRRD RTS bonanza

The EC yesterday adopted a Delegated Regulation supplementing the BRRD. The regulation contains a number of RTS in the following areas: Content of recovery and resolution plans. EBA final drafts published in July 2014 and December 2014 Article 6(8). Principles and minimum criteria for assessment of recovery and resolution plans. EBA final draft published in […]

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