Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Grant Thornton Banking Regulation: unravelling the regulatory spaghetti - mar...theitchik
Several years after the economic meltdown, banks are still struggling to navigate the waves of regulation designed to avoid further crises.
The necessity to re-regulate an industry that lacked transparency was indisputable; however, what started as a global action plan soon became a puzzle of diverging national agendas.
It is clear the banking landscape is changing. Explore what open banking means and the impact it could have on the market. Find out more in our report at Deloitte.co.uk/Flourish. You can also discover further analysis on open banking and the future of banking generally at Deloitte.co.uk/FutureBank.
Grant Thornton Banking Regulation: unravelling the regulatory spaghetti - mar...theitchik
Several years after the economic meltdown, banks are still struggling to navigate the waves of regulation designed to avoid further crises.
The necessity to re-regulate an industry that lacked transparency was indisputable; however, what started as a global action plan soon became a puzzle of diverging national agendas.
It is clear the banking landscape is changing. Explore what open banking means and the impact it could have on the market. Find out more in our report at Deloitte.co.uk/Flourish. You can also discover further analysis on open banking and the future of banking generally at Deloitte.co.uk/FutureBank.
MAZARS Luxembourg - New substance requirements for holding and financing comp...Quentin Van Gansberghe
The OECD BEPS project has rapidly moved to the implementation phase, leaving a new tax environment. This new environment requires businesses to re-evaluate your holding and financing structures, and assess your tax strategy with the aim of developing a sustainable tax framework.
Mazars Luxembourg has hosted a conference to present this new tax environment and to identify adequate strategy(ies). Our guest speaker, Dr. Vikram Chand, Executive Director of the Master of Advanced Studies in International Tax and Executive Program in Transfer Pricing at the University of Lausanne and our Mazars has covered, during this conference, the following three topics:
• The impact of the OECD BEPS and EU Anti Tax Avoidance Package on holding and financing companies;
• The substance requirements for holding activities ; and
• The substance requirements for financing activities, especially, in light of the Actions 8-10 of the BEPS plan and the new Luxembourg transfer pricing circular for intra-group financing activity.
You will find in attachment the slides of this presentation.
For any questions, feel free to contact Dr Vikram Chand (vikram.chand@unil.ch) or Mr François Karolyi (francois.karolyi@mazars.lu)
In this edition of Regulatory Focus, the experts in Duff & Phelps round up the latest news and publications issued by the Financial Conduct Authority. Read more
The vote to leave the EU by the United Kingdom in June 2016 has given rise to uncertainty in the Financial Services context. Joey Garcia, of ISOLAS in Gibraltar, addresses some of the key issues relating to the funds industry in Gibraltar
On your mark EU Financial Transaction Tax for asset managersKNOWitALL
TO GET READY FOR THE EU FINANCIAL TRANSACTION TAX FINANCIAL INSTITUTIONS ARE IN A RACE AGAINST TIME AND POLITICS!
The article reviews the progress of legislative developments regarding the Financial Transactions Tax proposed by 11 member states of the EU. Drawing from the industry’s experience of implementing similar transaction taxes it analyses impact from the perspective of the operational challenges posed and makes a case for considering these wider implications in time to ensure regulatory compliance.
UK Adjudicators are an Adjudicator Nominating Body (ANB) for the United Kingdom and International construction and engineering industries.
www.ukadjudicators.co.uk
MAZARS Luxembourg - New substance requirements for holding and financing comp...Quentin Van Gansberghe
The OECD BEPS project has rapidly moved to the implementation phase, leaving a new tax environment. This new environment requires businesses to re-evaluate your holding and financing structures, and assess your tax strategy with the aim of developing a sustainable tax framework.
Mazars Luxembourg has hosted a conference to present this new tax environment and to identify adequate strategy(ies). Our guest speaker, Dr. Vikram Chand, Executive Director of the Master of Advanced Studies in International Tax and Executive Program in Transfer Pricing at the University of Lausanne and our Mazars has covered, during this conference, the following three topics:
• The impact of the OECD BEPS and EU Anti Tax Avoidance Package on holding and financing companies;
• The substance requirements for holding activities ; and
• The substance requirements for financing activities, especially, in light of the Actions 8-10 of the BEPS plan and the new Luxembourg transfer pricing circular for intra-group financing activity.
You will find in attachment the slides of this presentation.
For any questions, feel free to contact Dr Vikram Chand (vikram.chand@unil.ch) or Mr François Karolyi (francois.karolyi@mazars.lu)
In this edition of Regulatory Focus, the experts in Duff & Phelps round up the latest news and publications issued by the Financial Conduct Authority. Read more
The vote to leave the EU by the United Kingdom in June 2016 has given rise to uncertainty in the Financial Services context. Joey Garcia, of ISOLAS in Gibraltar, addresses some of the key issues relating to the funds industry in Gibraltar
On your mark EU Financial Transaction Tax for asset managersKNOWitALL
TO GET READY FOR THE EU FINANCIAL TRANSACTION TAX FINANCIAL INSTITUTIONS ARE IN A RACE AGAINST TIME AND POLITICS!
The article reviews the progress of legislative developments regarding the Financial Transactions Tax proposed by 11 member states of the EU. Drawing from the industry’s experience of implementing similar transaction taxes it analyses impact from the perspective of the operational challenges posed and makes a case for considering these wider implications in time to ensure regulatory compliance.
UK Adjudicators are an Adjudicator Nominating Body (ANB) for the United Kingdom and International construction and engineering industries.
www.ukadjudicators.co.uk
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Certified Risk and Compliance Management Professional (CRCMP) Prep Course Pa...Compliance LLC
Certified Risk and Compliance Management Professional (CRCMP) Prep Course – Part A
First Certified Course
Certified Risk and Compliance Management Professional (CRMCP)
This course has been designed to provide with the knowledge and skills needed to understand and support regulatory compliance and enterprise wide risk management, and to promote best practices and international standards that align with business and regulatory requirements.
The course provides with the skills needed to pass the Certified Risk and Compliance Management Professional (CRCMP) exam.
This course is intended for professionals that want to understand risk and compliance and to work as risk and compliance officers. They will prove that they are qualified, when they pass the Certified Risk and Compliance Management Professional (CRCMP) exam.
This course is intended for employers demanding qualified risk and compliance professionals. The course is recommended for senior executives involved in risk and compliance.
CEI Compliance is the UK's fastest growing regulatory consultancy and provides associate opportunities to consultants and cost effective value to financial services and other regulated companies.
We show you the methodology for conducting the Compliance Risk Assessment and how to provide meaningful action plans.
In this edition of Regulatory Focus, the experts in Duff & Phelps’ UK Compliance and Regulatory Consulting team, provide a detailed synopsis of the latest news and publications issued by the Financial Conduct Authority during May and June 2018.
https://www.duffandphelps.com/insights/publications/compliance-and-regulatory-consulting/regulatory-focus-july-2018
Here is a short summary of what Solvency II is and how it’ll impact financial services institutions in the US (most of which are deemed to have fully or partly equivalent rules) along with EU.
The Solvency II Directive, along with the Omnibus II Directive that amended it became a law on March 31, 2015. On April 1, 2015 the approval processes began, and after years of delay and negotiations, the Europe-wide capital regime for insurance companies came into effect on January 1, 2016. Insurers will have to comply with new rules and capital requirements of Solvency II across the EU.
Here is a short summary of what Solvency II is and how it’ll impact financial services institutions in the US (most of which are deemed to have fully or partly equivalent rules) along with EU.
Buy-side chair Organized Trade Execution Exchange No 05369106 WS-I Transitions to OASIS Akadimias 81 PC 10678 E.D.GOUTOS SA.
Government Administration Managing LOU LEI: (AIFMs), Department Member … EUROPÄISCHE KOMMISSION (Registrierungsnummer : 2016/072505) SA.45289(2016/MI) Authorized Economic Operator (ΑΕΟ) E.D. GOUTOS S.A. NCAGE cod: CM200 E.D.GOUTOS.SA. ΝΑΤΟ ARMY GR ΑΡΘΡΟ 5 HRB 68648 ΝΕΟ ΕΛΛΗΝΙΚΟ ΝΟΜΙΣΜΑ EG Credit Central Bank of Cyprus SIC 8888 LEI YUV8PRHOZSRFRC4JO269 and Register Ministry AG HRB68648 = 5299 00 PH63HYJ86ASW55 Cross border ...Address: Ar.G.W.MI. 0000931106 HELLENIC REPUBLIC EIN/TIN - SIC 8888 https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&SIC=8888&owner=include 0000931106. EIN/TINNEW GLOBAL OPEN WEB E BANKING MARKET HANDLING INTERNATIONAL GREEK CHARGES GR0112005674 E.D.GOUTOS SA Postleitzahl 21300 Ort PORTOCHELI GREECE Staat Vereinigte Staaten von Amerika Steuernummer/USt-IdNr. 93172860596 Sitz des Geldinstitutes GREECE Bankleitzahl (Sortcode)
Special Report: Data Management Implications Of Solvency IIConor Coughlan
This is a special report that Thomson Reuters has sponsored relating to the practical challenges facing practitioners in adhering to Solvency II. This report provides the read with some unique insights into how the industry is dealing with this matter.
if you are working for or connected to an Insurer, Asset Manager, Custodian, Fund Administrator or Prime Broker this will be of interest to you.
2016 Analysis on Beyond Implementation, Insurance, Business and Market Effect...Ganesh Pandagale
Description-
Synopsis
Timetrics 'Insight Report: Solvency II Beyond Implementation' analyzes the developments in the insurance industry following the implementation of Solvency II on January 1, 2016.
Most insurers in Europe region have found taht their risk management and governance strategies have improved as a result of Solvency II. Moreover, the regime prepares the ground for a single insurance market across Europe, enabling insurers and reinsurers to operate under the same set of regulations.
It will increase the competitiveness of insurers and reinsurers, and provide the same level of consumer protection throughout the European insurance industry.
To Browse a Report Detail with TOC @ http://www.researchmoz.us/insight-report-solvency-ii-beyond-implementation-report.html
International Association of Risk and Compliance Professionals (IARCP)
http://www.risk-compliance-association.com
Every Monday
Top 10 risk and compliance management related news stories and world events
Do you want to receive (at not cost) every Monday the Top 10 risk and compliance management related news stories and world events that (for better or for worse) shaped the week's agenda, and what is next?
You can register at:
http://www.risk-compliance-association.com/Top_10_Risk_Compliance_Management_Stories_Events.html
Receive the New Member Orientation Newsletters
You will have the opportunity to learn (at not cost) what members registered before you have already learned. Understand better risk and compliance management, projects, careers, challenges and opportunities.
You can register at:
http://www.risk-compliance-association.com/New_Member_Orientation_Newsletters.html
European insurers would like to see the European Insurance and Occupational Pensions Authority fining regulators where Solvency II is not applied equally across the European Union.
This is one of the key findings of The Effects of Solvency II, a White Paper publish today by Post Europe, in association with Atos Origin
The Insurance Reporting Challenge: Building an Integrated FrameworkAccenture Insurance
The reporting component of Solvency II has become a major concern for insurance companies operating in Europe. Solvency II Pillar III increases reporting requirements in terms of volume, frequency, timeliness and complexity. These, in turn, have a direct bearing on insurers’ data, processes, methodologies and organization. The pressure put on insurers to enhance their reporting calls for a revamped closing and reporting framework where integration is part of the approach. Beyond the new Solvency II requirements, reporting, in our view, remains a pressing issue at the global level.
Dodd-Frank's Impact on Regulatory ReportingHEXANIKA
We previously analyzed how Dodd-Frank and how the new regulations have impacted large banks as well as midsize and small banks. This time, we will look at how the law meant to address one issue (avoid a financial meltdown similar to 2008) might have created other challenges for banks – the most important one that of regulatory reporting:
In this edition of Regulatory Focus, Duff & Phelps provides a synopsis of the FCA's latest news and publications issued in May 2017.
Highlights include:
MiFID II Topics and Challenges
FCA's increased focus on cyber resilience
Guidance on the Criminal Finances Act 2017
Legal Shorts 11.12.15 including FCA makes changes to GABRIEL and FCA roundtab...Cummings
Welcome to Legal Shorts, a short briefing on some of the week’s developments in the financial services industry.
Listen to this week's Legal Shorts on CLTV by going to http://vimeo.com/cummingslaw
If you would like to discuss any of the points we raise below, please contact me or one of our other lawyers.
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Solvency ii Association
http://www.solvency-ii-association.com
We are pleased to announce our updated Distance Learning and Online Certification programs:
1. Certified Solvency ii Professional (CSiiP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiP_Distance_Learning_Online_Certification_Program.htm
2. Certified Solvency ii Equivalence Professional (CSiiEP) Distance Learning and Online Certification Program
http://www.solvency-ii-association.com/CSiiEP_Distance_Learning_Online_Certification_Program.htm
Register to receive Solvency II / Omnibus II related alerts, opportunities, updates, our monthly newsletter and limited time offers for our Solvency II / Omnibus II Training and Certification programs:
http://forms.aweber.com/form/28/1910009328.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Basel iii Compliance Professionals Association (BiiiCPA)
http://www.basel-iii-association.com
The Basel iii Compliance Professionals Association (BiiiCPA) is the largest association of Basel iii Professionals in the world. It is a business unit of the Basel ii Compliance Professionals Association (BCPA), which is also the largest association of Basel ii Professionals in the world.
Receive (at no cost) the New Member Orientation newsletters:
http://www.basel-iii-association.com/New_Member_Orientation_Newsletters.html
Subscribe to Receive (at no cost) Basel II / Basel III Related News, Alerts, Opportunities, Updates, our Monthly Newsletter and Limited Time Offers for our Basel II / Basel III Training and Certification Programs:
http://forms.aweber.com/form/42/1586130642.htm
Risk management presentation April 15 2013Compliance LLC
International Association of Risk and Compliance Professionals (IARCP)
http://www.risk-compliance-association.com
Every Monday
Top 10 risk and compliance management related news stories and world events
Do you want to receive (at not cost) every Monday the Top 10 risk and compliance management related news stories and world events that (for better or for worse) shaped the week's agenda, and what is next?
You can register at:
http://www.risk-compliance-association.com/Top_10_Risk_Compliance_Management_Stories_Events.html
Receive the New Member Orientation Newsletters
You will have the opportunity to learn (at not cost) what members registered before you have already learned. Understand better risk and compliance management, projects, careers, challenges and opportunities.
You can register at:
http://www.risk-compliance-association.com/New_Member_Orientation_Newsletters.html
International Association of Risk and Compliance Professionals (IARCP)
http://www.risk-compliance-association.com
Every Monday
Top 10 risk and compliance management related news stories and world events
Do you want to receive (at not cost) every Monday the Top 10 risk and compliance management related news stories and world events that (for better or for worse) shaped the week's agenda, and what is next?
You can register at:
http://www.risk-compliance-association.com/Top_10_Risk_Compliance_Management_Stories_Events.html
Receive the New Member Orientation Newsletters
You will have the opportunity to learn (at not cost) what members registered before you have already learned. Understand better risk and compliance management, projects, careers, challenges and opportunities.
You can register at:
http://www.risk-compliance-association.com/New_Member_Orientation_Newsletters.html
International Association of Risk and Compliance Professionals (IARCP)
http://www.risk-compliance-association.com
Every Monday
Top 10 risk and compliance management related news stories and world events
Do you want to receive (at not cost) every Monday the Top 10 risk and compliance management related news stories and world events that (for better or for worse) shaped the week's agenda, and what is next?
You can register at:
http://www.risk-compliance-association.com/Top_10_Risk_Compliance_Management_Stories_Events.html
Receive the New Member Orientation Newsletters
You will have the opportunity to learn (at not cost) what members registered before you have already learned. Understand better risk and compliance management, projects, careers, challenges and opportunities.
You can register at:
http://www.risk-compliance-association.com/New_Member_Orientation_Newsletters.html
International Association of Risk and Compliance Professionals (IARCP)
http://www.risk-compliance-association.com
Every Monday
Top 10 risk and compliance management related news stories and world events
Do you want to receive (at not cost) every Monday the Top 10 risk and compliance management related news stories and world events that (for better or for worse) shaped the week's agenda, and what is next?
You can register at:
http://www.risk-compliance-association.com/Top_10_Risk_Compliance_Management_Stories_Events.html
Receive the New Member Orientation Newsletters
You will have the opportunity to learn (at not cost) what members registered before you have already learned. Understand better risk and compliance management, projects, careers, challenges and opportunities.
You can register at:
http://www.risk-compliance-association.com/New_Member_Orientation_Newsletters.html
Affordable Stationery Printing Services in Jaipur | Navpack n PrintNavpack & Print
Looking for professional printing services in Jaipur? Navpack n Print offers high-quality and affordable stationery printing for all your business needs. Stand out with custom stationery designs and fast turnaround times. Contact us today for a quote!
Business Valuation Principles for EntrepreneursBen Wann
This insightful presentation is designed to equip entrepreneurs with the essential knowledge and tools needed to accurately value their businesses. Understanding business valuation is crucial for making informed decisions, whether you're seeking investment, planning to sell, or simply want to gauge your company's worth.
Memorandum Of Association Constitution of Company.pptseri bangash
www.seribangash.com
A Memorandum of Association (MOA) is a legal document that outlines the fundamental principles and objectives upon which a company operates. It serves as the company's charter or constitution and defines the scope of its activities. Here's a detailed note on the MOA:
Contents of Memorandum of Association:
Name Clause: This clause states the name of the company, which should end with words like "Limited" or "Ltd." for a public limited company and "Private Limited" or "Pvt. Ltd." for a private limited company.
https://seribangash.com/article-of-association-is-legal-doc-of-company/
Registered Office Clause: It specifies the location where the company's registered office is situated. This office is where all official communications and notices are sent.
Objective Clause: This clause delineates the main objectives for which the company is formed. It's important to define these objectives clearly, as the company cannot undertake activities beyond those mentioned in this clause.
www.seribangash.com
Liability Clause: It outlines the extent of liability of the company's members. In the case of companies limited by shares, the liability of members is limited to the amount unpaid on their shares. For companies limited by guarantee, members' liability is limited to the amount they undertake to contribute if the company is wound up.
https://seribangash.com/promotors-is-person-conceived-formation-company/
Capital Clause: This clause specifies the authorized capital of the company, i.e., the maximum amount of share capital the company is authorized to issue. It also mentions the division of this capital into shares and their respective nominal value.
Association Clause: It simply states that the subscribers wish to form a company and agree to become members of it, in accordance with the terms of the MOA.
Importance of Memorandum of Association:
Legal Requirement: The MOA is a legal requirement for the formation of a company. It must be filed with the Registrar of Companies during the incorporation process.
Constitutional Document: It serves as the company's constitutional document, defining its scope, powers, and limitations.
Protection of Members: It protects the interests of the company's members by clearly defining the objectives and limiting their liability.
External Communication: It provides clarity to external parties, such as investors, creditors, and regulatory authorities, regarding the company's objectives and powers.
https://seribangash.com/difference-public-and-private-company-law/
Binding Authority: The company and its members are bound by the provisions of the MOA. Any action taken beyond its scope may be considered ultra vires (beyond the powers) of the company and therefore void.
Amendment of MOA:
While the MOA lays down the company's fundamental principles, it is not entirely immutable. It can be amended, but only under specific circumstances and in compliance with legal procedures. Amendments typically require shareholder
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Solvency ii News May 2013
1. P a g e | 1
Solvency ii Association
1200 G Street NW Suite 800 Washington, DC 20005-6705 USA
Tel: 202-449-9750 www.solvency-ii-association.com
Dear member,
Lifeis becoming more complex for risk
managers.We must have a “forward-
lookingperspective”, remember?
We have all thesenew lawsand regulations…
… but wealsohave rules, proposalsand reportstoconsider.
Have you ever discovered the common elementsof thevarious
initiatives,includingthe Volcker rule in the United States, theproposalsof
theVickersCommission for theUnitedKingdom, the Liikanen Report to
theEuropean Commission?
LeonardoGambacorta andAdrian van Rixtel from theMonetaryand
EconomicDepartment of the BISwill help ustoday to seethe common
elementsand the differences!
This is a great analysis! We read:
TheVolcker rule isnarrow in scope but otherwisequitestrict.
It is narrow in that it seekstocarveout onlyproprietary trading while
allowingmarket-makingactivitieson behalf of customers.
Moreover, it hasseveral exemptions, includingfor transactionsin
specific instruments, such asUS Treasuryand agencysecurities.
It is strict in that it forbids the coexistenceof suchtrading activitiesand
other banking activitiesin different subsidiarieswithinthesame group.
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It similarlypreventsinvestmentsin, and sponsorship of, entitiesthat
could expose institutionsto equivalent risks,suchashedge fundsand
privateequityfunds.
That said, it imposesvery few additionalrestrictionson the transactions
of banking organisationswith other financial firmsmore generally(eg
such asthrough constraintson lendingor funding among them).
However, it is worthrememberingthat the current US legislationdoes
constrain theactivitiesof depositoryinstitutions.
TheLiikanenReport proposalsare somewhat broader in scope but less
strict.
Theyare broader because theyseek tocarve out both proprietarytrading
and market-making, without drawinga distinctionbetweenthe two.
Theyare lessstrict becausetheyallowtheseactivitiestocoexist with
other bankingbusinesswithin the samegroup aslong astheseare
carried out in separatesubsidiaries.
Theproposalslimit contagion withinthegroup by requiring, in
particular, that thesubsidiariesbe self-sufficient in termsof capital and
liquidityand that transactionsbetweenthe legal entitiestake place on
market terms.
Just like theVolcker rule, theproposalsdo not envisagesignificant
restrictionsbetweentheprotectedbanking unit and other financial
firms, except that theyrequire theseparation of exposurestoentities
such ashedge fundsand special investment vehicles (SIVs) in the
tradingentity.
TheVickersCommission proposalsare evenbroader in scope but have a
more articulatedapproachtostrictness.
Solvency ii Association
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Solvency II: whereare we now?
Although there is nocertaintyon the SolvencyII
implementationdate, EU policymakersare continuing to finalisekey
aspectsof the framework.
Recent developmentsincludeEIOPA‟s consultationon interim
measures,the impact assessment of the long-term guaranteepackage
and a debate on whethernew legislationis needed formally todelay
SolvencyII‟sapplication.
Solvency II implementation date
Thelegal positionis that Member States
must transposetheSolvencyII Directive
intonational lawsby30 June 2013and
applyit to firmsfrom 1January 2014.
It is clear, however,that this SolvencyII
timetableis not feasible.
EU Member Statescannot implement the
SolvencyII framework by the set dates, for thesimplereasonthat it is
not finalised.
AMember State‟sfailure to meet thelegal implementation deadlinesfor
SolvencyII wouldmean that it wasnot complying with EU law and
could have legal implications.
As a result, MemberStatesare keen to ensurethat further legislation
amendsthe SolvencyII Directive to postpone deadlinesfor SolvencyII
implementationon a formal basis.
This can bedone bymeansof another “quick-fix Directive”, similar to
theone adopted last summer, whichestablished current transposition
and implementationdates.
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Many peopleexpect implementation to beput back to January2016.
TheEuropean Commission, however, is resistingpressure tointroduce
anotherquick-fix, soasto encourage othersin theEU‟s legislative
processtoagree theOmnibusII Directiveasa priority.
Instead, the Commission proposestoproducea letter of comfort to
MemberStatesconfirmingthat it will not commenceproceedings
against them for failure to implement SolvencyII.
Thediscussion isongoingand wearemonitoring it.
EIOPA‟s consultation on Solvency II interim measures
Although the SolvencyII legislativeprocessisdelayed, EIOPAbelieves
that the insuranceindustryshould build on preparatory work already
undertaken.
In addition the IMF‟sFinancial SectorAssessment Programme (FSAP)
review of the EU concluded that earlyharmonised implementation of
SolvencyII wouldreduce risksarisingfrom thecurrent regime.
EIOPA hasthereforepublisheda set of consultationdocuments
proposingto introducesome core SolvencyII provisionsin advanceof
theformal deadline(still to be confirmed).
EIOPA‟sguidelinesare addressedtonational supervisorsand cover the
followingareas:
- System of governance
- Aforward lookingassessment of theundertaking‟sown risks(based
on theORSA)
- Submissionof informationto national supervisors(reporting
requirements)
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- Pre-applicationfor internal models
Lloyd‟s is reviewingthe guidelinesand contributing to thedebateat UK
and EU levels.
Many insurersare most concerned about EIOPA‟sproposedreporting
requirements,whichlook very onerous.
In arelated development, theEuropeanCentral Bank (ECB) plans to
passaRegulation enablingit tocollect information from insurersfor
financial stabilityand statistical purposes.
TheECB is workingwithEIOPA and, sofar aspossible, will rely on
data collectedthrough the SolvencyII reporting templates.
In the interim period, before Solvency II is implemented, it probablywill
not require insurerstoreport any additional data.
Longer-term, however, its requirementsmay become more extensive.
Legally, this Regulation will applyto EurozoneMember Statesonly,
although central banks in other MemberStatesmay decidetoimpose
similar reporting requirements.
It is unclear what positionthe Bank of England will take.
Impact assessment of the long-term
guarantee package
Last year‟sdebateson the long-term
guaranteepackageprovedinconclusive
andthe Commission decided to conduct
an impact assessment toinform Omnibus
II‟sdevelopment.
EIOPA launched theassessment in
January2013:insurershad until the end of
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March2013tosubmit information.
Lloyd‟s did not participatedueto the issue‟slimitedrelevanceto most of
Lloyd‟s business.
EIOPA is expectedtopublish a report withitsfindingsin Junethis
year, followedby a communication from the Commission.
Parliament hasscheduled a vote on theOmnibusII Directivefor 22
October 2013.
This is indicativeonly, but suggeststhedeadlineby whichagreement on
thelong-term guarantee packageshould be reached.
Compromisesover the long-term guaranteepackageand subsequent
adoptionof the OmnibusII Directive are important totheSolvencyII
implementationtimeline.
If agreement is not reachedand the Directiveis not finalisedin 2013,this
is likelyto delaySolvencyII implementationbeyond the expected
deadlineof January2016.
Solvency ii Association
www.solvency-ii-association.com
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Theimportance of culture in driving
behavioursof firms and how the FCA will
assessthis
Speechby CliveAdamson, Director of Supervision
at the CFA Society- UK ProfessionalismConference19April
2013,London.
Introduction
Good afternoon and my thanksto CFA Society for invitingme to speak
today.
Thesubject of my speech todayis theimportanceof culturein driving
key behavioursin firmsand how the FCAwill assessthis.
But beforeI take you through that, I wouldlike to provide some context.
As many of you will know, the FinancialConduct Authority (FCA) came
intoofficial beingearlier this month, takingover theconduct supervision
of 25,000firmsin theUK.
This is a significant moment in UK financial regulation, withthe
creationof a focused conduct regulator seekingtoprotect
consumers, enhancemarket integrity and promote effective
competition.
I think it is fair tosaythat weare all awareof theerosion of trust in
financial services.
This hasbeen caused partlyby the financial collapsein the banking
sector, but alsoby a seriesof large-scaleconduct failingsstretchingback
over many years, from pensionsmis-selling, endowment mis-selling, split
capsto more recently, PPI and the sale of interestrate hedgingproducts
toSMEs.
In the wholesalespacetoowehave seen the LIBOR scandal.
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Theseevents, and associatedlack of trust, have imposed substantial
costson consumers, firmsand the economy.
Sowhat hasgone wrong?
We accept that the FSAhasnot been aseffectivea conduct regulator as
it could havebeen.
But thereare other reasonstoo.
Firms have designed, manufactured and sold productsnot alwayswith
theneedsand interestsof their customersin mind but instead, seeing
thecustomer assomebody tomaximise profit from.
This hasbeen accentuatedby a view, and it hastobe said encouraged by
theFSA, that disclosureat the point of saleabsolvesthe sellerfrom a real
responsiblyof ensuring that theproduct or servicerepresentsa good
outcome for the customer.
This, in turn, has led in many casesto a tick-box and overlylegalistic
complianceculture within firms, encouraged by what hasbeenseen asa
tick-box regulatory approach.
Underpinningall of thisis the issueof culture.
In many cases, where things have gone wrong, whether it ismis-selling
of PPI or in attempting to manipulate LIBOR, a cultural issue is at the
heart of theproblem.
It is fair to saythat tomany in the outsideworld, the cultural approachof
doing the right thinghas been lost for financial services.
It is cleartous, therefore,particularlyasa conduct regulator, that the
cultural characteristicsof a firm area key driver of potentiallypoor
behaviour and I wouldlike to explorethisfurther withyou today.
Solvency ii Association
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What doI mean by culture?
Culture is like DNA.
It shapesjudgements,ethicsand behavioursdisplayed at thosekey
moments,big or small, that matter totheperformanceand reputation of
firmsand theservicethat it providesto customersand clients.
For us, weview culture through thelensof what mattersto usasa
conduct regulator.
This meansan effectiveculture isone that supportsa businessmodel
andbusinesspracticesthat have at their core, the fair treatment of
customersand behavioursthat do not harm market integrity.
This is very different from what wehavetodaywhere, asI said earlier, the
focushasbeen on ensuringcompliancewitha set of rulesrather than
doing the right thingfor customers.
Looked at this way, the responsibilityfor ensuring the right outcomesfor
customersresideswitheveryone at thefirm, led by senior
management, and not something delegated to complianceor control
functions.
Thechallengefor manyfirmsis that culture is hard tochangeand
requiresdedicatedand persistent focusover a number of yearsin order
toembeddeddifferent approachesand waysof behaving.
As the Saltz Review recentlyconcluded, if cultureis left toitsown
devices,it shapesitself, withthe inherent risk that behaviourswill not be
thosedesired.
Driversof culture at a firm
It seemsto me that wecan identify keydriversof culture at a firm. These
include:
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- settingthe tone from thetop;
- translatingthisintoeasilyunderstood businesspractices;and
- supportingtheright behavioursthrough performance
management, employee development, and reinforcing through
rewardprogrammes.
Let me saya few wordsabout each of these.
Setting the tone from the top
Settingthe tone isall about creatinga culture whereeveryone has
ownership and responsibilityfor doing the right thing, becauseit is the
right thing to do.
It is about setting valuesand translatingthem intobehaviours.
This can only be establishedby theCEO and other membersof the
seniormanagement team, whoneed to not only set out the keycompany
values,but alsopersonallydemonstratetheymean them through their
actions.
Theseclearlygowiderthan thosethat directlyimpact what we, asthe
conduct regulator, are lookingfor but should clearlyincludethese.
We have been encouraged to seethat a number of firmsare re-
articulatingtheir keyvaluesand principles,ledby their respectiveCEO
– and wesupport thismove.
For us, though, wewill want tosee this new tone translatedinto
behavioursthrough the organisation.
Businesspracticesand waysof behaving
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Thetask then isto translatethis tone intobusinesspracticesthat drive
howbusinessdecisionsare made, howthe firm respondsto events,how
individualsshould behaveand how issuesare elevated in an open way.
For me, therefore,translatingcultureintobusinesspracticesis a wayto
make cultureintosomethingmore hard edged.
I heard one CEO sayearlier this year that one of their keyvalueswasto
„treat our clientslike you woulda member of your family.
If you see a product featureyou wouldn‟t feel comfortablesellingto a
relative, then weshouldn‟t be sellingit toour customerseither‟.
Let me giveyou an examplethat waspassedon to me last week.
Thosewhocommutearound London will be awareof the problems
someweeksagoon the M25,which meant hundredsof passengersran
late for flightsout of Heathrow and Gatwick.
One airline, whichspotted this, and in light of somany of its passengers
facingdisappointment at theprospect of missingtheir flights,choseto
hold back certain planessothat passengershad a chanceto make their
flights.
Of coursethis meant it faced complaintsat the other end from the
dominoeffect of thedelayed flights, not tomention theadditional costs
duetoinactiveplanessat on therunway.
I am told though, that once the announcement made it totheother
end, there werenocustomer complaintsmade.
Theykey point from thisexampleis that the airlinetook a judgement
call and did what it thought wastheright thingfor itscustomers,even
though it came at a cost.
This is thekind of consumer-focusedbehaviour that customerswould
reasonablyexpect to be shown by the financial servicesindustry.
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But wehave alsoseen caseswhen this hasnot beenthe case.
Take our useof mystery shopping asa supervisory tool, asan example.
When weassessedthe qualityof investment adviceat themajor retail
banksand building societies,wefound that the messages
communicated from thetop of a firm werenot fullyembedded intothe
day-to-day operationson the shop floor.
Thistranslatedintopoor advicebeing giventoconsumers - in fact we
found that in one quarter of cases, consumersweregiven unsuitable
adviceor theadviserhadn‟t gathered enough information to ensure their
advicewassuitable.
Thepoint here isthat, although senior management may havethought
that good advice wasbeinggiven, this wasn‟t happening on the ground.
Performancemanagement, employee development and reward
programmes
Performancemanagement, employee development and reward
programmesareclearlya powerful lever toinfluencethe culture of any
organisation.
We have seen in financial serviceshow themisalignment between
incentivesstructuresand corporatevalueshasled to significant damage.
Our own workon financial incentivesnoted that high-riskincentive
schemeswiththe potential for salesstaff toearn big bonuseswere
common acrossauthorised firms.
Sadly, wealsouncovereda catalogueof serious failings, includingfirms
strugglingtounderstand their own incentiveschemesbecausethey were
socomplex.
Soit isnot surprising that wesee more eventssuch asthe „shareholder
spring‟last year, whichsent a strong messagetotheexecutivesof those
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firmsthat financial incentivisationisstill a critical factorthat needstobe
carefullybalanced to reinforcepositivecorporate expectations.
I am pleased though that many firmshave either alreadychanged or are
currentlychangingtheir salesincentivesplans.
Thequestion is then, how can a firm incentiviseand reward its
employeesin a responsiblewayto encourage theright outcomes?
I mentioned remuneration asbeingan important lever, but sotoo are
effectiverecruitment and promotion policies,development and
performancemanagement of employees – so, if by advancingsomeone
you areessentiallytellingthem that their behaviour within theworkplace
is appropriate, or even outstanding, then you need toensure, and be able
todemonstrate, that they are reinforcingtheright valuesbefore making
that decision and embeddingthat behaviour.
How will the FCA assessculture?
I‟d like now toturn my attentiontohow theFCA will be assessing
culture.
Our approachtoday is todraw conclusionsabout culture from what we
observeabout a firm – in other words,joiningthedotsrather than
assessingculturedirectly.
This can be through a range of different measuressuch ashow a firm
respondsto, and dealswith, regulatory issues;what customersare
actuallyexperiencingwhentheybuy a product or servicefrom front-line
staff; how a firm runsitsproduct approval processand theconsiderations
around these;the manner in whichdecisionsare madeor escalated;the
behaviour of that firm on certain markets;and even theremuneration
structures.
We alsolook at how a board engagesin thoseissues,includingwhether
it probeshigh return productsor businesslines,and whetherit
understandsstrategiesfor cross-sellingproducts,how fast growthis
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obtainedand whetherproductsarebeingsold to marketstheyare
designedfor.
We are able, from all of this, todraw conclusionsabout the cultureof a
firm.
This includesassessingif the perceivedcustomer-focusedcultureis
supported by, for example, regular discussionson conduct at board level
and appropriatesalesincentivesplans.
How will the FCA encouragepositive culture change in firms?
We don‟t have direct rulesabout culture,although our high-level
principlesfor businesscome closeto thisin some respects.
As I have set out here, wedon‟t directlysupervise „culture‟.
However, asculture and businesspracticesare soimportant in driving
behaviours,wedo want toencourage positiveculture changein firms.
We will therefore increasingly, as I have indicated, draw conclusions
about a firm‟s culture and reflect that back to firmsas part of the risk
assessment process.
Wherewebelieve cultural measuresexposure the firm to a high level of
risk in thecontext of our objectives,wewill expect thefirm totake
account of it.
Of course,there areother waysto improve standards.
With the Retail DistributionReview (RDR), wehave set new professional
standardsand I am pleasedwith the progressindustrymadetomeet these
bythedeadlineof last year.
In addition, aspart of our new supervisory approach, wewill be placing
greater emphasison individual accountability aswell ascorporate
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accountabilityfor meetingour standardsand wewill be more prepared
tohold these to account whenthingsgowrong.
Summary
I hopethishasgiven you a better ideaof whyweat theFCA are
interestedin the culture of firmsand how weare goingabout assessing
it.
There is no doubt that this isa complex subject and one whereour
thinkingwill continue to evolve asthe FCAestablishesitself, whichis
whywewouldlike toencourage widerdebateabout it and how wecan
positivelyinfluenceit.
Soto summarise,culture is important tousasa conduct regulator
becauseof its role in drivingbehavioursin firms and direct impact on
our intended outcome of ensuring that customersget the right
outcomes.
We certainlysupport the roleof the CFASocietyin raisingprofessional
standardsand look forwardtodiscussingthisissueover the years ahead.
Thank you.
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Letters…
… betweenAndrew Tyrie MP, and the ExecutiveDirector of the
Prudential RegulationAuthority, Andrew Bailey, discussingSolvency II.
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Erkki Liikanen: Banking structure
and monetary policy – what have we
learned in the last 20 years?
Presentation by Mr Erkki
Liikanen, Governor of the Bank of Finland
and Chairman of the Highlevel Expert
Group on thestructure of theEU banking
sector, at the conference“Twentyyearsof
transition– experiencesand
challenges”,arrangedbytheNational Bank
of
Slovakia, Bratislava.
How is today‟s perspectiveon monetarypolicy different from what
prevailed 20 years ago?
Twentyyearsago, the worldof todaywasbeing formed in manyways.
1993wasthe year whenthe Economic and MonetaryUnion project was
becomingpolitical reality: theMaastricht treaty had been signedand
wasin theprocessof beingratified.
It wasalsothetime when themainstream approach to monetary policy
wasbeginningto convergetothe flexibleinflationtargetingframework.
Anumber of countrieshad then just adopted an explicit inflation
targetingstrategy.
In the sphereof banking regulation, too, a new era wasbeginning.
Asignificant reorientationwasgoingon, awayfrom regulating the
conduct of banks and towardsthenew risk-basedapproach.
Theregulatorytrend, based on increased freedom for banksbut subject
torisk based capital requirements,wouldcontinueall the wayto the
eruptionof thefinancial crisisin 2008.
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In the EU, the second bankingdirectivetook effect from thebeginning
of 1993,creatinga singlemarket in banking.
Thedirectivesought to prevent discriminationand to increase efficiency
through competition.
There wasdiscussionon the implicationsof thisfor supervision, but
littleaction.
So, whileEuropean banking marketswerebeingintegrated, financial
supervision remained a national competence.
In the U.S., deregulation wasalsomoving forward.
For instancethe Glass-SteagallAct, separatingbanking from securities
and insurance, wasunder growingcriticism and wouldbe ultimately
repealedin 1995.
One reason for the dissatisfaction with the Glass-Steagall system in the
US was competition from European banks which were less restricted in
what theycould do.
Twentyyearsago, the striking improvement in macroeconomic
performance, later named “the great moderation” by chairman
Bernanke, wasspreadingtothe wholedeveloped world.
Thealmost surprisingsuccessof monetary policy in improving price
stability and reducingfluctuationsin economic activity, while also
keepinginterestratesat historicallylow levels, wasinterpreted asa
major victory for theart of economic policymaking.
Now weknow that there wastroublebrewingunder the surface.
Theunderpinningsof global financial stabilitywerebecoming weaker.
Global indebtednessincreased, fuelledby current account balancesand
the“deepening” of international financial markets(read: recycling the
samefundsseveral timesover).
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Thedecline of inflation wasnot only due to monetary policy, but alsothe
avalancheof cheap consumer goodsfrom the emerging economiessuch
asChina contributed to it.
For banks, the new financial environment wascharacterizedby low
interest ratesand low perceived risks.
It alsoturned out that the new risk-basedcapital requirementsallowed
the banks to expand their balancesheetsenormously without increasing
their equitycapital in the same proportion.
So, graduallythe largebanking groupsstarted toincreasetheir trading
portfolios.
This development happened in a gradual fashion in the 1990‟sbut
accelerateddramaticallyfrom about 2004.
Banks redirected their businessfocusfrom interestmarginstofee-based
andtrading activities.
Universal banking, asit had been knownin Europe, startedtochange.
Theasset mix of thelargest banks changedsothat securitiesportfolios
activitiesgrew more and more important.
Onlynow, from theperspectivegivenby theworstfinancial crisis since
theSecond World War, do wesee clearlythefragilityand weaknessof
theregulatoryarrangementswhichcameintoforce in the 1990s.
From today‟s point of view, theyperformed well only aslong asno major
systemic risksmaterialized.
Even worse,theyallowedrisksto accumulate in the financial system
whichwereonly waitingtobe realized.
Then came 2007and the collapseof theUS propertymarket; 2008and the
collapseof interbank money marketsfollowingthe Lehman Brothers
crisis;and 2009withThe Great Recession.
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Thepainful processof competitivedeleveragingstarted.
Thereassessment of economicpoliciesfollowedin the lasttwodecades
hasalsostarted.
Especiallyfinancialregulation hasbeenreconsideredand is being
strengthened.
We needto think of monetary policy, too, especiallyin itsconnection to
financial stability.
Monetary policy and financial stability
There is a common dictum that a stable financial system is a necessary
condition for successful monetary policy, and that price stability in turn
createsthebest preconditionsfor financial stability.
I agree.
Still, the experienceof this crisishasthought usa lot more.
First of all, wenow know that pricestability doesnot by itself guarantee
financial stability.
Riskscan accumulatein thebankingsystem even if monetary policy
succeedsin maintainingprice stabilityand controllinginflationary
expectationsreallywell.
Second, wealsoknow that central bankscan maintain an admirable
degreeof pricestabilityeven when financial stabilityis under a lot of
strain.
Dothesetwopointsmean that financial stability and monetary policy
are not connected after all?
No.
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Theyare very closely related.
Independence of monetary policy
One of thelastinglessonslearned in thelast decadesisthe value of the
independenceof monetarypolicy.
The independence of central banks has been essential keeping inflation
expectations as well anchored as they have been in this crisis despite all
theturmoil in thefinancial markets.
Independencehasalsomade it easierfor central banksto act quickly
whenit hasbeen necessaryin order tomaintainfinancial stability.
It is especiallyimportant to avoid twothreatstoindependence:fiscal
dominanceand financial dominance.
Fiscaldominanceisthe older concept of thetwo.
It wouldarise if thegovernment financing constraint wouldbecome an
overridinginfluenceon monetary policy.
Theideaof fiscal dominancewasformalized by Tom Sargent and Neil
Wallacein 1981,but of coursethe worrythat deficit financingmay cause
inflationhasmuch longer rootsin monetary thought.
Theideathat tight monetary policymay become impossiblewithout
accompanyingfiscal adjustment wasalsowellunderstood whenthe
blueprintsfor the EMU werebeingprepared.
This is whythe Maastricht treatyhad itsfiscal policy clausesand also
whythe Stabilityand GrowthPact wasconcluded.
Also the prohibition of direct central bank credit to the government and
theinstitutional independenceof the central banks are in effect
protectionsagainst fiscal dominance.
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Now weknow, of course, that thefiscal frameworkasput in placebefore
thestart of the EMU wasnot strong enough to prevent fiscalproblems
from emerging.
Somehave argued that fiscaldominancehastakenhold in thein thebig
industrializedcountries during thecrisiswhen the central banks have
used government bond purchasesin order tostabilize the markets(asthe
ECB) or to produceadditional monetary stimuluswhenthe interestrate
instrument hasalready been used tothemaximum (like the Federal
Reserveand theBank of Japan).
As to the euroarea, for me there isnow noevidenceof fiscaldominance.
Fiscaldominanceimpliesthat monetarypolicy wouldbreak its price
stability objectivefor the sake of maintainingthe solvencyof the
government sector.
This is not the case.
Price stability hasnot and will not be abandoned.
We have well knownfiscal problemsin some of the euro area countries.
Still, theECB‟sabilityto goon maintainingpricestabilityhasnot been
weakened.
In particular theinflation expectations,whichare themost essential
indicatorsof thecredibility of monetarypolicy, have remainedwell in
linewiththeprice stabilityobjective.
Theparallel ideaof financial dominanceis more recent than fiscal
dominance.
Financial dominancerefers tothe possibility that the condition of the
bankingsystem could become a constraint, or dominant influence,on
monetary policy, effectivelyforcing the central bank to pursuesecond- or
third-best monetary policiesin order tomaintainfinancial stability.
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Is thespill-over from financial instabilityto monetary policy a realistic
threat?
Can financial stabilityconsiderationslead the central bankstotolerate
toohigh inflation, just tokeep the banking sector afloat?
In principleit is easyto see whyit could be.
One can imagine a central bank whichwouldhavetotightenits
monetarypolicy for price stabilityreasons,but is preventedfrom doing
sofor the fear that the value of theassetsof thebanking system would
decreaseand a financial crisiscould ensue.
Episodeswhichfit the description of financial dominancehave been
observed in emergingeconomiesafter some banking crisesin the past.
But lookingat recent experience, this hasnot been thecasein the
developed economies.
Thebust of the credit boom hasnot led monetary policyto tolerate a
higher-than-mandatedrateof inflation.
Instead, in the largedeveloped economiesat least, the burstingof the
bubblehascoincidedwitha sudden contraction of private demand and a
deep recession.
Thenegativeeffect of thebust on economicactivityhas actuallyreduced
inflationarypressuresand in some cases(such asin Japan in the 1990‟s)
created a real danger of deflation.
Themain problem hasthen becomehow to prevent the credit
contraction from startinga deflationaryspiral.
In such conditions,the same monetary policy will then both easethe
strain onthe banking sector and support price stability.
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This observationdoesnot mean that financial instabilitywouldnot pose
a seriouschallengetomonetary policy.
On thecontrary, thedownwardimpact of a bust, if it is large, may be
more difficult tocontrol than the preceding period of credit expansion.
There was a famous discussion on how monetary policy should relate to
asset prices in the Jackson Hole conference of 2007, where Rick Mishkin
introduced thetopic.
At that time, the prevalent thinkingin central bankingcircleswaswhat
professorIssinglater called “theJacksonHole consensus”,meaning
that it isbetter for monetary policy onlyto“clean” (up afterwards) than
to“lean” (againstthe wind).
After thehard lessonswelearned over thelast five years thecasefor
benign neglect of asset boomsand onlypickingup the piecesafterwards
is not sostrong any more.
Thecrisisexperiencesupportsrather theidea that financial excessesare
betterprevented astheyhappen than onlymanaged after theyhave
causeda recession.
This would be the best wayto prevent “downwardfinancialdominance”
whichcould ariseif monetary policy could not effectivelycounteract
credit contraction.
Unconventional toolsand the independence of monetary policy
Recent experienceshowsthat the central banks‟box of potential toolsis
actuallyvery deep, and if it hasbecomenecessaryto utilize
unconventional tools, asin thepresent crisis, these new toolshave been
developed and deployed.
In the caseof the ECB, the new toolshave includedthe transitiontofull
allotment auctions,thelong term refinanceoperationsup tothree
years, wideningof the scope of eligible collateral, and the variousbond
purchaseprogrammes.
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Themost recent of theseis theOMT programme announcedlast
summerbut not yet commenced in practice.
Thedevelopment of new toolshasbeen justified.
The slip of the depressed economies to dangerous deflation has been
averted, and the debt and banking problems have not developed into
systemic financial meltdownsin the affectedcountries.
We have seen that central bankscan pursuesuccessful pricestability
policy alsounder very difficult conditions.
Theeventsaround the worldsincethecollapseof Lehman Brothersare
evidenceof that.
Deflationhasbeen avoideddespite a severe recessionin many countries.
However, there are alsocertainproblemswithrelying on theenlarged
toolkit of thecentral banks.
Theabilitytoact in crisishasled to thecentral banksbeingeven called
“theonlygame in town”.
We should resistthisidea and bewareof thedanger that problemswhich
are fundamentallypolitical could be pushedtocentral banksto solve.
Adivision of responsibilitiesbetweenappointed officialsand elected
politiciansshould be preserved.
Monetarypolicy cannot administer the needed structural transformation
in thereal sector of the economy or solve excessivedeficit problemsof
governments.
There aresituationswherethe central banks just haveto act and dotheir
best to stabilize theeconomy, even if they wouldhave to usetoolswhich
gobeyond just adjustingtheshort rate of interest or the aggregate
liquidityof the banking system.
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Thepresent financial crisishasconstitutedone suchsituation.
Avoiding the bustswhichseem to followcredit boomsand periodsof
“financial exuberance”wouldmake thetasksof monetarypolicy much
easierand protect the independenceof central banks.
But thereare alsodifficultieswiththe leaningagainst the wind.
One hasto dowiththe problem of detectingthecredit cycle in time, and
correctlytiming themonetary policyresponse.
Another problem isthat price stabilitymight get lessattention.
Tomitigatetheseproblems,somethingelsebesidesmore vigilant interest
rate policy isneededtoprevent low and stableinterestratesfrom leading
toexcessesin banks and financial markets.
One development can be the development of macro-prudential
instrumentswhichare designed to improve the stability of the financial
system asa whole.
Themajor workin this fieldwasdonebythe deLarosière group.
Otmar Issingwasa member of thegroup.
Especially interesting are those macro-prudential instruments which
have a time dimension so that they can be adjusted according to the
changingsituationin the credit markets.
Such instrumentsinclude,in particular, thecountercyclical capital
requirements,aswell asthe adjustablerestrictionson Loan-to-Value
ratios.
TheCRD IV directivewill make the former instrument obligatoryin the
EU countries; implementationof the latter is left to national discretion.
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Now it is very important to establishan effectivetoolkit for both
European and national authorities.
We must alsocreateinstitutional conditionswhichdonot prevent these
toolsto beused when needed.
Therefore, weneed clear decision makingcompetencesat all levels.
Theconnectionbetweenmacro-prudential policy and itstimedimension
with monetary policyis sointimatethat central banksmust be closely
involvedin macro-prudential analysis and decisionmaking.
Macro-prudential policy is important, but it needstobe supported by
structural reformswhichwouldmake thebanking system more resilient,
and - I emphasise- lessprone tounstablebehaviour.
The Structural reform proposals
In order toprevent the present crisisfrom beingever repeated,
governmentsand authoritieshave started a large-scaleoverhaul of
financial regulation.
Theregulatoryagenda can bebroadly dividedintothe followingareas:
•Strengtheningof the prudential regulation of solvencyand liquidity
•Improving the institutional basisfor supervision and crisis
management
•Introduction of macro-prudential instrumentstoprevent systemic risks
in thebankingsystem and financial markets
• Regulatingthe structure of the banking sector
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Thestructural reform proposalswhichappear asthe last item on thislist
aim toseparatethe riskiestsecuritiesand derivativesbusinessfrom the
deposit banking activities.
This is theessentialcontent of the proposalsby the EU High Level
Expert Group, whichI chaired, published last autumn.
It is alsoat the core of the Volcker rule whichis being implementedin
theUS, and the Vickersproposal in theUK.
Thecurrent legislativeproposalswhichare underwayin Franceand
Germanyare alsoin thesame vein.
Aparticular concern of theseproposalshasbeen tolimit theextent of
explicit or implicit public guarantees,sothat theywouldnot induce
additional risk taking.
This kind of competitivedistortion could result in securitiestrading
gettingconcentratedin the largest deposit banks, and thesedeposit
banksbecoming enormousrisk concentrationsbuilt on implicit or even
explicit public guarantees.
Separation proposalstry toisolatesecuritiesbusinessfrom thesourcesof
thisdistortion and reducethe incentivesto excessiverisktaking and risk
concentration.
In must be emphasizedthat thestructural reform weproposed is not a
cure-all but should be seen asa part of acomprehensive regulatory
agendawhichisalready moving forward.
This includesbetter solvencyand liquidityrules.
Also, theEU will finallyget supervisionand resolution frameworksat the
union level.
Thedifferent componentsof thecurrent regulatory agenda complement
and support each other.
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In thisEuropean context, thestructure and stability of thebanking
sector is of vital importancetothe economy.
It is imperativeto improve itsresiliency.
TheHigh Level Expert Group report containsfive main
recommendationson how to reform thebankingsector.
I will just refer tothreeof them here:
•Thefirst is toseparate anysignificant proprietary trading in securities
andderivativesfrom deposit banks.
These activities could be carried out in a separately capitalized and
funded subsidiary, a trading entity, which could belong to the same
bankinggroup asthedeposit bank.
We proposed that alsomarket makingbe allocated to the trading
subsidiary in order toprevent the useof tradinginventoryto circumvent
the prohibition on proprietary trading.
•Theuse of trading subsidiarieswouldallowthebankinggroupsto offer
“one-stop banking” totheir clients,but without thepossibilityof funding
tradingactivitieswithinsuredretail deposits.
Financial linkagesbetweenthe deposit bank and the trading unit would
havetobe restricted in accordancetonormal largeexposurerules.
•Another of our proposalsisto develop specific, designatedbail-in
instrumentsto improve the lossabsorbencyof banks.
Arequirement toissuesuch bail-in debt wouldhelp ensure the
participationof investorstothe recapitalizationof a bank if this should
becomenecessary.
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Such designatedbail-in instrumentswouldclarifythehierarchyof debt
commitmentsand allowinvestorstopredict theeventual treatment of
therespectiveinstrumentsin caseof recapitalizationor resolution.
•Thegroup alsoproposed that the capital requirementson trading
assetsand real estaterelated loansbe reviewed.
Both of theseasset categoriescame to have very lowrisk weightsin the
Basel II regime, mostlybecausethewayinternal models wereapplied.
Why banking structure matters for monetary policy
Let me recapitulatemy main points.
First, for monetary policy, financial stabilityis very important.
While monetary policyhasproven tobeableto pursue price stability even
under rather strainedfinancial conditions,the central banks arenot able
to insulate thereal economy completely from the after-effectsof financial
crises.
Amore stablebanking sector whichis lesspronetocrisis will reducethe
likelihoodof crisesand thereforeprotect thebalancesheetsof the central
bank from financial risksand therebyprotect itsindependenceand
credibility.
Second, themost important part of stability policy is crisisprevention.
Improvinglossabsorbencyof banks and thecrisismanagement powers
of the authoritiesare necessary, but it iseven more important tomake
surethat excessivegrowthof credit and indebtednesscan be better
controlledin the future.
In thisway, credit crunchesand banking crisescanbe made lesslikely –
andmilder, should theyhappen.
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Third, financial stability wouldbenefit from structural reform of the
bankingsystem.
By separatingthe most risky securitiesand derivativeactivitiesfrom
deposit banking, thespill over from deposit protection tospeculativerisk
takingwouldbe prevented.
This would reducethe distorted incentivestoexpand tradingactivities
and concentraterisksin deposit banks becauseof their privileged
positionin the deposit market.
Finally, the structural reform of bankingis a complement, not a
substitutefor other regulatory improvements.
For central banks, thedevelopment of macro-prudential policiesand
instrumentsis especiallyrelevant.
Thosemacro-prudential instrumentswhich can be adjustedover time to
managethe conditionsin the credit market will offer a waytobetter
control the accumulation of excessrisk and help prevent future crises.
Theseinstrumentsoperatesoclosetomonetary policy that central banks
should be very closelyinvolved, if not themselvesresponsible,in
developing and using them.
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Changesin the Large Exposure
Regime
CONSULTATION PAPER
GUERNSEY FINANCIAL
SERVICES COMMISSION
1:Executive Summary
1.1Overview
This paper containsfull details of theproposalstosubstantiallyalter the
LargeExposure principlesand guidancethat apply to licensed deposit
takersthat are incorporatedin Guernsey.
It is proposedthat the new regime wouldtake effect from 1January2014.
Theseproposalsincludechangestoenhancethequarterlyprudential
reporting totheCommissionand thiswouldaffect not only licensed
deposit takersincorporatedin the Bailiwick, but alsothoselicensed
deposit takerswhoseprincipal place of businessisoutsidethe Bailiwick.
Thecontext for the review is that the existingPrinciple1/ 1994/ 24
“Principlesand Guidancetobe followedby a locallyincorporated
licenseddeposit takinginstitution enteringintoa largeexposure” paper
publishedby the Commissionin 1994nolonger adequatelyaddressesthe
risksassociated withlargeexposures,particularly thosearisingfrom the
systemic and market risks that became evident asa result of the
2007/ 2008financial crisis.
In respect of largeexposures,the Commission hastended to be a
“pragmatic” supervisorrather than a rigid standard based
supervisor,and, it hasfrom timeto time allowedsuitablycollateralised
largeexposuresin excessof 25% of net capital base.
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Given that anychange to a more restrictiveapproach may have a
businessimpact on licenseesthe Commission feelsthat it isappropriate
toseek theviewsof industry.
The Commission is proposing to retain several elements of its pragmatic
approach and in seeking the views of industry it will be open to bilateral
discussionswithlicenseesabout particular types of exposures.
2. What is proposed?
Thesubstantivechangesbeing proposed in updated guidanceare as
follows:
- Exposurestocentral governmentsand market loansof lessthan 12
months‟maturity, whichare exempt from the current largeexposure
regime, will be deemedtobe largeexposuresunder the new regime.
- Thecurrent upstreamingregime will changeto expressagreed
exposure limitsto parent/ group banksasa proportion (i.e. %) of
capital baserather than aproportion of assets.Theupstreaming
regimewill includeon balancesheet and off balancesheet
exposures.
- Exposurestothird party bankswill normallybe limitedtoa
maximum of 100% of net capital base and will comprise cash
placements,holdingof debt instrumentsand off balancesheet
exposures.Themaximum proportion (%) of exposure will be
determined accordingto the rating of thethird partybank, although
limited flexibilitywill be permittedin the caseof exceptional short-
term excesses.
- In relationto exposuresto sovereigns,the concept of ZoneAand
ZoneB countrieswill be replaced withtwodifferent OECD-based
groupings- High IncomeOECD countries and other countries.
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Exposureswill be capped at a maximum of 1000%of net capital base
and will be determinedaccordingto the ratingof the sovereign.
- Exposurestoclientsor groupsof connectedclientswill be capped at
a maximum of 25% of net capital base, unlessthe exposure issecured
bycashand/ or High Income OECD government securities, or the
exposure issubjecttoa parental guarantee(whichin itselfwould
need to be includedin any upstreaminglimit).
Sub-participationagreementsthat transfer credit risk off thebalance
sheet of the Guernseybank will alsobe considered.
- Better definition of what constitutes“connectedclients”will be
provided.
- Theprudential reportingformswill be changed tobetter capture
largeexposuresthat have not previouslybeen reported; e.g. holdings
of debt that equatetomore than 10% of a bank‟snet capital base.
In accordancewithexpected international developments, the
Commission alsoproposestocapture thetop twenty, rather thanthe
current top ten, largest exposures.
Brancheswill be askedtoreport similar details,but in termsof their
parental capital, sothat data on any significant credit concentration risk
in a branch in Guernseythat may impact on a head office elsewherecan
becollected.
- Breachesof largeexposure limitswill be a reportable event. The
Commissionisproposinga staged approach todealing with
exposuresthat cannot be regularised.
- The800% aggregatelimit on exposureswouldbe retained, but
exposurestoGroup, to third party banks and tosovereignswouldbe
excludedfrom thisaggregate.
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- Largeexposuresexistingprior tothe intendedeffectivedate for the
new regime of 1January 2014wouldbe grandfatheredin.
1.3 Rationale for change
The large exposure regime is all about capturing concentration risk and
it is covered by s24 of The Banking Supervision (Bailiwick of Guernsey)
Law, 1994.
Conventional wisdom, asdictatedbythe Capital RequirementsDirective
andthe Basel Core Principlesfor EffectiveBanking Supervision, states
that no exposure toa client or connected group of clientsshould equateto
more than 25% of net capital.
Short term interbank exposureshavehistoricallybeen exempt from this
requirement.
Our current environment reflectstheseexemptionsand alsopermits
exposurestoclientstoexceed the 25% limit.
Whilst pure concentrationrisk to singleobligor counterpartieswasnot
seen asa majordirect contributor tothe2008financial crisis,nonetheless
elementsof concentration risk wereseen asindirect contributors.
Interconnectednesswithin and betweengroupswereseen asmagnifiers
of some exposures and concentrationsthroughsectoral exposuresto
particular economicsectors(e.g. the Irish property development sector)
affected credit assessmentsof many organisations.
That said, the guidanceon largeexposuresremainshistoricin nature;
theBasel Committee guidanceon measuring and controllinglarge
exposuresdatesback to1991,and our ownlocalregime hasnot been
significantlyupdated since1994.
However, there havebeen substantial changestothe EU largeexposure
regime.
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Thesesubstantial changeshave their origin in late2007and early
2008, when theCommitteeof European Banking Supervisors
(CEBS), whichhassincebecome theEuropean Banking
Authority, reported totheEuropean Commission onthe effectivenessof
thelargeexposureprovisionsof the Capital RequirementsDirective.
Thereport concluded that market failuresassociatedwith systemic risk
and moral hazard applied tointerbank exposuresregardlessof maturity.
Accordingly, thelargeexposure regimefor EU member stateswas
revisedwitheffect from December 2010totighten largeexposure
limits,particularlyin relationto interbank and intra-group
lending, whichtheEuropean Commission agreed wasa major systemic
risk in the wakeof the financial crisis.
Under the revised EU regime, short term loanstobanks areno longer
exempt and whilst limitednational discretionis availabletomember
statesin relationtointra-group lending, loanstothird partybanksare
now capped at 25% of net capital, unlessthe lendingbank is very small.
In reality, by the timethe changestotheEU regime came along, market
practicehad alreadychangedtoreflectthis more cautiousapproach to
interbank lending.
It is worthnoting that the CEBSconclusionswerealsoreflectedin the
UK Government‟s responsetothe report on banking reform by the
Independent Commission on Banking (“the VickersReport”).
TheHM Treasury whitepaper “BankingReform – deliveringstability
and supporting a stableeconomy” publishedin June 2012 envisagesthe
limitingof a ring-fencedbank‟sexposure to financial institutionsin
order to prevent systemic shocks.
ClearlyGuernseyis not in the EU, but neverthelesswewouldnot wishto
bea completeoutlier in respect of largeexposures.
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TheBasel Core Principlesfor EffectiveBankingSupervision do givethe
supervisorsome latitudein permitting “minor deviations”from the 25%
limit, but the economicclimatethat hasprevailed for all but the last few
years combinedwiththe Commission‟swishtobe a pragmatic regulator
hasmeant that these“minor deviations”havebeen permittedmore
frequentlyin thepast than isarguablynow prudent in the current
economicand regulatoryclimate.
Theguidance however, remainsthe same and a changeis needed to
manageexpectationsand formalise a prudent approach.
In developing proposalsfor a new largeexposureregimethe
Commissionhashad regard toa number of other regimes, including
thoseoperatingin theUK and the other Crown Dependencies.
None of theseare a good fit in their entirety for the type of banking
businessdone in and from within the Bailiwick.
The Commission has therefore tried to balance the requirements of other
regimes against the type of banking business that exists in the
Bailiwick, recognising also the intra-group funding that many licensees
provide.
1.4 Who would be affected?
Licensed deposit takersthat are incorporatedin Guernseywouldbe
thoseprincipallyaffected, given that limitson exposuresarebeing
proposedin relation to capital.
However, the proposed revisions to the large exposure regime include
enhanced quarterly prudential reporting for all licensees and branches
wouldthereforebe affectedby thesechangestothe BSL/ 2 reports.
The Commission
TheGuernsey Financial Services Commission is the regulatorybody for
thefinancesectorin theBailiwick of Guernsey. TheCommission‟s
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42. P a g e | 42
primaryobjectiveis toregulateand supervise financial servicesin
Guernsey, with integrity and efficiency, and in sodoing help touphold
theinternational reputation of Guernsey asa financecentre.
Tolearnmore:
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43. P a g e | 43
Adjustment and growth in the euro
area
Speech by Mr Peter Praet, Member of the
Executive Board of the European Central
Bank, at the European Business
Summit, Brussels, 16May2013.
Introduction
Thank you very much for invitingme to
speak at this conferenceof the European
Business
Summit.
Thethemeof my addresstoday is“Adjustment and Growth in the Euro
Area”.
This is a titlethat, to some, may sound contradictory.
Many of you will have come acrosscommentatorswhoclaim that
adjustment is in fact inimical togrowth;and that consolidating
government budgetswhileintroducingstructural reformsisthe main
causeof our current difficulties.
Yet, in my view, thisis a short-sightedassessment.
While it is clearthat fiscal consolidationhasaffected economic activity
in theeuro area in theshort-term, it doesnot followfrom thisthat
adjustment and growth are incompatible.
Restoringthe sustainabilityof publicfinancesand implementingwell-
designedstructural reformsare key to restoring confidence.
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Measuresthat are now beingundertakenhelp tolaythe foundationsfor
futuregrowthand bring back a climate of confidencealreadyin the
short-term.
First, by prioritisingfiscalconsolidation, euro area countriescan anchor
medium-term expectationsabout public debt sustainability, whichis
essential to support confidenceamong investorsand taxpayers.
As many euro area countriesalreadyhave high public debt
levels,and some have seentheir market accessthreatened, credible
fiscal
consolidationensuresthat debt can be refinancedat affordableratesin
thefuture, and fiscal crisesavoided.
Moreover, if consolidationisfocused to the greatest extent possibleon
unproductiveexpenditureitemsrather thanthose, like investment, that
are conducive tolong-term growth, thenegativeeffectson growthcan be
contained.
Second, by implementingstructural reforms, euro area countries should
raisetheir future growthpotential.
Researchhasshownthat a comprehensive packageof product and
labour market reformscould significantlyincreaseeuro area output – by
more than 4.5% over 5 years, accordingtoa recent IMF study.
This improved outlook, whenincorporatedintomedium-term
expectations,shouldencourage forward-lookingfirmsto increase
investment, and could hencelead to higher growthalsoin theshort-
term.
Such reformsshould be undertaken withdue protection of the most
vulnerable membersof society.
Thekey point is that for adjustment and growthtobe mutually
supportive, the commitment to reform hasto be credible.
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Investors,firmsand householdshave to be convincedbeyond doubt that
governmentswill staythe course.
If theyfear policy commitmentsmay bedelayed or reversed in the
future, they will neither besufficientlyconfident in the sustainability of
public financesnor in future growthpotential toalter their behaviour
today.
“Wait-and-see” will remain the rational responseand short-term growth
will lagbehindpotential.
In other words,proposingtoreversecourseon fiscal and structural
reforms doesnot support growth.
In fact, it onlyweakenscredibilityand henceunderminesthehard work
that hasalreadybeen done toput theeuro area on a surer footing.
For theremainder of my remarks, I wouldlike to first review the ongoing
processof adjustment acrossthe euro area and what hasbeen done by
national authorities, and the ECB actingwithin itsprice stability
mandate, to facilitatethat process.
Thereafter, I will put forward some suggestionsfor what remainstobe
done by euro area governmentsto ensurea return to growthasspeedily
aspossible.
1. Restoring growth and employment in the euroarea
Let me begin by reviewingthe economic situation.
Euro area real GDP still remainsabout three percentagepointsbelow its
pre-crisispeak, although thisaggregate figure hidessome divergence.
For thegroup of countrieswhich are still under some financial stress
(Greece,Spain, Ireland, Italy, Portugal, Cyprusand Slovenia), real GDP
remainsnear thetrough of the crisisreachedin 2009.
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Other euro area countries, however, had by 2011alreadyrecoveredthe
previousmaximum level of real GDP.
Thesame is true of labour markets.
Theemployment rate in the euro area asa wholeis still more than two
percentagepointsbelow its peak, accordingtoOECD figures.
However, Germanyhasincreased itsemployment rate by more than
threepercentagepoints(to73.1%) while, at theother extreme, Greece
hasseen its employment ratedroppingby more thanten percentage
points(to50.1%).
Youth unemployment ratesin a number of stressed countries also
remain unacceptablyhigh.
Looking forward,weexpect the euroareaeconomy toresumegrowthat
a modest pacelater in 2013,although it will take more timefor this to
feed through intohigher employment.
Why isgrowthnot rebounding more quicklyand evenlyacrossthe euro
area?
Akey explanationisthat the adjustment processhasbeen hinderedby
adversefeedback loopsresultingfrom the interactionof accumulated
fiscaland macroeconomic imbalances, weakbank balancesheetsand
thelack of a genuinely European approach tobank resolution and
recapitalisation.
Togive just one exampleof such interactions,largefiscal imbalancesin
a Member State can lead financial marketstodriveup yieldson its
sovereigndebt.
This in turn createshigher fundingcostsfor itsdomestic banksand
reduces their profitability, therebyhamperingcredit growthtothe real
economy.
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Lower credit growththen contributesto lowernominal GDP, whichnot
onlyfurther weakensbanks‟balancesheetsby increasingnon-
performing loans,but alsoincreasesconcernsabout the sustainability of
sovereigndebt through the denominator effect;and thus, the feedback
looprestartsagain.
Without a European approachto banking sectorrepair, if the sovereign
intervenesto break the feedback loop byrecapitalisingor resolving
banks,it may only heightenmarket concerns about itsdebt
sustainability and aggravatethesituation.
a. Actions by governments
Addressing such adversefeedback loopsbetweengovernment
finances,credit and growth impliesa triplepolicyresponsefrom
governments:
First, fiscal consolidationand current account rebalancingtosecure
public debt sustainability and lowerexternal financingneeds.
Second, structural reformsto increasepotential growthand offset the
potential negative effects of fiscal consolidation.
Third, comprehensivebanking sector repair toacknowledgeimpaired
assetsand strengthen bank balancesheets.
Fortunately, in all three areastheeuro area is headingin the right
direction.
First, fiscal and macroeconomic imbalanceshaveimproved significantly:
fiscaldeficitshavedeclinedfrom their 2009peaksthroughout the euro
area based on sizeableconsolidation effortsand despitestrongeconomic
headwinds,while there hasbeen a pronounced reduction of current
account deficits.
However, thesesizeableflowadjustmentshavenot yet fullytranslated
intoimprovementsin theaccumulatedstock of imbalances– public debt
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ratios on the fiscal side, net internationalinvestment positionson the
macroeconomicside– becauseof depressednominal GDP growth.
Most EU countries made significant progresstowardsfurther reducing
budgetaryimbalancesin 2012,in an environment of weakerthan
expectedoutput growth.
Theeuro area government deficit hasdecreasedto 3.7% of GDP (3.1% of
GDP excludingone-off government support for financial institutions).
In 2013,the Commission expectstheeuroarea deficit toreach 2.9% of
GDP – i.e. below theMaastricht referencevalue.
This level wouldbe lessthan half the peak reached in 2009(6.4% of
GDP), and it putstheeuro area asa wholeon track tocomply withthe
commitment madeby G-20leadersin Torontoin 2010to halve fiscal
deficitsby 2013.
It hastobe stressedthat correctingfor theeffectsof the weakcycle the
fiscaladjustment hasbeen even larger than suggestedby thesefigures.
Progresswithfiscal consolidation hasbeen particularlystrong in
countriessubject toan economicadjustment programme.
Theprimary structural deficit (cyclically-adjusteddeficit net of interest
paymentsand net of one-off factorsand temporarymeasures) asa ratio
of GDP over the period2009–2012hasfallenby around 14percentage
pointsin Greece, 6 percentagepointsin Portugal and 4percentage
pointsin Ireland.
Thetrue adjustment effort is likely tohave been even larger thanthese
numberssuggest due to significant revenueshortfallsin a context of
rebalancingfrom (tax-rich) domestic demand towards(taxpoor) exports.
This rebalancinghasalsobeen associatedwithsignificant
improvementsin current account positions.
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Current account deficitsfell on averageby 10 percentagepointsof
GDP in Greece, Ireland and Portugal from 2008–2012,and by 8
percentagepointsof GDP in Spain over the same period.
Second, the euro area witnesseda renewedmomentum toimplement
structural reforms.
It hasbeen well-understoodby euro area countriesthat restoring fiscal
sustainability must rest not onlyon fiscal adjustment to achievesizeable
primarysurpluses,but alsoon measuresto revive growthtoavoid
adversesnowball effectsundoing thedebt-stabilisingimpact of primary
surpluses.
This requiresstructural reformsthat improve labour market and product
market functioningand henceincreasepotential growth.
There arenumerousstudies, for instanceby theOECD and the
IMF, showingthesignificant benefitsin termsof employment and growth
that could accrueto theeuro area from such measures– and not only in
themedium-term.
Acrediblecommitment by euro area governmentstoimplement
structural reforms could alreadycreatea permanent upwardshift in
expectationsof futuregrowth, improve labourmarket performance, and
asa welcomeside-effect, improve thehealth of public financesover the
medium-term.
And to a certainextent, this iswhat weare seeingin theeuroarea today.
As regardslabour market reforms, several euro area countrieshave
movedtowardsa negotiatingframeworkfor wagesand working
conditionsbased more on firm-level agreements.
This should enhancecompetitivenessby promoting a closerlink
betweenwagesand productivityand, at thesame time, allowfirms to
rapidlyadjust their internal organisationof labour and production in
responseto changingeconomic conditions.
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In addition, labour market functioninghasbeen strengthenedby
addressingdistortionsrelatedtothe“two-tier” systemsthat characterise
a number of euro area economies – in particular Spain and Italy.
Thesemeasuresshould support social fairnessby bringingto an end the
situation wherevulnerable temporaryworkers,mainlyyoung people, de
factobear the full burden of theadjustment.
Moreover, theyshould increasepotential growthby improvingthe
employment conditionsof young workersand their relativelylower
opportunitiesfor on-thejob training, whichsignificantlyhampershuman
capital formation; and by reducinginefficient labour turnover, sincefirms
wouldbe lessreluctant to transform temporaryjobsinto permanent ones.
At the same time, to reduce unemployment trapsand createincentives
for job-seeking, welfaresystems arebeingreformed soastoshift from a
system providing security“onthe job” tooneproviding income support
“in themarket”, whilesettingup strict eligibilitycriteria and a system of
activelabour market policies.
Together with theselabour market measures,reform effortshave
focused on increasingcompetitionin a number of sectors,including
retail and wholesale,transport, energy, and professional services;
reducingthe administrativerequirementsto set up or expand
businesses;and improvingtheefficiencyof civil justice and public
administration.
Third, euro area countrieshavetaken a series of measurestoaddress
balancesheet weaknessesin the bankingsector.
Capital requirementsare in the processof being strengthened following
theconclusion of theCapital RequirementsIV Directive, which
transposesthe BaselIII agreement intoEU law.
At the same time, a number of banksraisednew capital to address
balancesheet weaknesses.
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Thegreatest progressin financial sector repair hasof coursetaken place
in thecountriesunder EU-IM F programmes,wherethere hasbeen a
comprehensiverestructuringand recapitalisationof the domestic
bankingsectors.
Spain hasalsotakendecisivemeasurestoaddressthe imbalancesof the
past via itsESM indirect bank recapitalisationprogramme.
b. Actionsby the ECB
What is the role of theECB in this process?
While theECB hasconsistentlyplayed itspart and maintainedprice
stability in the euro area, it is important tokeep in mind that therole that
thecentral bank can play in termsof crisis resolution is limited.
TheECB‟smonetary policy can onlyplaya crisismitigationrole.
Hence, our monetary policy approach hasfocused on providingliquidity
support, intended to relieve banksof liquidityand funding stressby
givingthem unlimitedaccessto central bank money at a fixedprice
against adequatecollateral.
Tofacilitatethis support, weexpanded the set of eligible assetsthat can
beused ascollateraland extended thematurityof our lending.
It is widelyrecognisedthat thesemeasureshave been effectivein
avertinga disorderlyspiral of deleveragingin thebankingsystem, which
wouldhave taken place in an environment of severe liquidityconstraints
and fire sales.
This wasnecessaryin order toavoid deflationarydownwardpressures
that wouldhaveprevented usfrom deliveringon our mandate of
preservingprice stability in theeuro area.
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However, to mitigatethe crisiswehave alsohad togobeyond liquidity
support, in particular tocounter financial fragmentation in the euro area
– created by the adverse feedback loopsI described above– that was
disruptingthe transmission of monetary policy acrosstheeuro area.
Divergingcredit conditionsbycountries,by sectorsand by size of
companies have prevented the ECB‟s very accommodativemonetary
policy stancefrom beingpassedon evenlyin the financingconditions
faced by euroareafirms and households.
As the euro area economyreliesheavily on bank credit, thishasserious
implicationsfor growthand ultimatelyfor our abilitytomaintain price
stability.
In particular, in the first half of last year weperceiveda situationlastyear
wheresevere upward pressureon sovereignyieldswasbeing drivenby
unfounded fearsabout thefuture of the euro area.
Thesefearswerecausing investorstochargerisk premia to lend tosome
MemberStatesthat could not be justifiedby economicfundamentals.
We thereforedecided toopen the possibility of undertaking Outright
MonetaryTransactions(OMTs), entailingex anteunlimitedinterventions
in short- tomedium-term securitiesissued by governmentswhichhave
submitted to strict and effectiveconditionality, in order to eliminate the
pricingof un-warrantedtail risksin the bond markets.
This hasplayed an important role in reducingfinancial market
fragmentation, asfinancial marketsunderstood OMTsasa credible
backstop for counteringredenominationrisk.
2. What remains to be done
Thesemeasuresbythe ECB, however, can onlybuy time; theycannot
substitutefor the responsibilitiesof national governmentsto addressthe
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unsoundfiscal,economicand financial policiesthat are the root causes
of the crisis.
And while a great deal has already been done by euro area authoritiesto
addresstheseroot causes,there arethree areasin whichmore progress
still needstobe made.
First, the euro area needstocontinuetodeepen structural reforms aimed
at enhancingcompetition, flexibility, efficiency, and productivity.
Thereform processtakestime, and soa medium-term, comprehensive
approachiscrucial toanchor expectationsand maximisethe positive
effectsof adjustment in theshort-term.
Thegreatest challengetodayis tomaintain reform momentum and
implement fullythosechangeswhichhavealready been announced or
even enacted intolaw.
Concretely, this means, for the labour markets, addressing the remaining
insider-outsiderdualitiesand enhancinglabour mobility, includingacross
borders.
For product markets, the key challengeisto openup regulated
professionsand networkindustriesthat are shelteredfrom competition
bygovernment regulations.
This requiresa simplificationand streamliningof regulations, a
reduction of barriersto entry and limitstocompetition, a resolute
deepeningof theSingleMarket in Europe.
Going forward, structural reformsalsoneed to gointothe government
sector itself.
In several euro areacountries, modernisation of public administration is
essential to increaseefficiencyin the provisionof public goods,like
infrastructure,and essential services, likecivil justice.
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This will alsosupport fiscal consolidation, by reducingthe size of the
government sector.
Second, the euro area needstoperseverein fiscal consolidation efforts
and reducesteadily thegovernment debt ratio.
Despitethe important progresson fiscal consolidation, debt ratioshave
yet failed to stabilise in most euro area countries,asimprovementsin
primarybalanceswereoutweighedbythe debt-risingimpact of
unfavourabledevelopmentsin interest-growthdifferentialsand deficit-
debt adjustments.
Theeuro area government debt ratio isprojectedtorise further toabove
95% of GDP in 2013– far abovethe 60% Maastricht referencevalue
– withdebt ratiosdisplaying largedifferencesacrosscountries.
Further adjustment isthus inevitable,and unfortunately it must take
placein an environment of rising consolidation fatigue.
Fiveyears intothe crisis thisrise in consolidationfatigue is
understandable.
Going forward,it will be important for policymakersto communicate
effectivelyboth on the need for further adjustment and how this
adjustment will be distributedin an equitablewayacrossdifferent
groupsof the population.
In thiscontext, it is necessaryto review consolidationstrategiesthat have
reliedpredominantlyon tax rateincreases,exacerbatingthe burdenon
alreadycompliant taxpayers, without much broadeningof thetax bases.
Such an approach hashad substantial negativeeffectson disposable
income and demand, at thesame time raisingresistanceand negative
reactionsin theelectorate,basedon inter-temporaluncertaintyand
fairnessconsiderations.
Due protection of themost vulnerableis needed here.
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On theexpenditure side, adjustment hasrelied disproportionallyon cuts
in government investment, therebyweakeningthe prospectsfor long-
term growth.
Going forward, thereis a needto focusadjustment on unproductive
expenditurewhile asfar aspossiblesafeguarding government
expenditurethat is conducivetolong-term growth.
Third, the euro area needstopressahead withconstructinga genuine
BankingUnion.
Afirst and important stephasbeen made withthe decision tocreatethe
SingleSupervisoryMechanism(SSM), the responsibilityfor which was
assignedto theECB.
Political agreement by the ECOFIN Council and theEuropean
Parliament wasreached on a legislativepackagein March, and technical
agreement isexpectedvery soon, sothat national parliamentary
proceedingscan start, whichshould be concluded by the summer.
Theexistenceof theSSM, by reducingregulatory captureand increasing
supervisoryconsistencyand coherence, should play an important role in
increasingconfidencein the overall euroarea banking system, and asa
result, reduce fragmentation of interbank and other financial markets.
However, for the Banking Union to be fullyeffective,a SingleResolution
Mechanism(SRM) toaccompanytheSSM is essential.
This is thecasefor a number of reasons.
First, an SRM would allow for the euro area to complete the process of
banking sector repair without aggravating market concerns over public
debt sustainability, which would help break the adverse feedback loop I
describedabove and restorethefunctioningof the credit channel.
Second, thisconfidencein EU level resolution capacitywouldensure
that the SSM can be a crediblesupervisor, asit wouldbe abletopush
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non-viablebankstowardswindingdown without endangeringfinancial
stability.
Third, an SRM would facilitate speedy and effective resolution of large
and complex cross-border banks, removing the need for drawn-out and
inefficient cooperationbetweenmultiplenational authorities.
Togeneratethesebenefits,in our view theSRM must be built around a
SingleResolutionAuthority and a European Resolution Fund.
Conclusion
Let me nowconclude.
Theongoing processof adjustment in the euroarea, if persevered
with, will createa path out of the crisis.
There is no doubt that thispath is a challengingone, asit dependson
deeprootedreformstothe structure of theeuro area‟seconomies,and
theserequire courage to implement and a willingnessto confront vested
interests.
But it is critical that governments stay the course, as this will allow the
confidence effects of a brighter outlook to start being felt already in the
short-term.
For itspart, the ECB will continueto fulfil its mandate to maintainprice
stability, and touseitsstandard and non-standard measurestosupport
theflow of credit to the real economy.
But one must alsorecognisethe limitstowhat weasthe central bank
can achieve.
We cannot remove barriers to bank lendingthat stem from insufficient
capital or lack of bank repair: thesecan onlybe addressedby
governments.
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This is whyestablishinga Banking Union with a strong Single
Resolution Mechanismis a priority.
I am gladthat the elementsof a Banking Union are beginningto fall into
place.
Aswift implementation of the remaining elementsisneeded.
Significant progresshasbeen made on fiscal consolidationand
structural reform.
Looking ahead, credibilityis crucial.
Therefore, I welcomethe stronger rulesfor fiscal and macroeconomic
policieslike theFiscal Compact.
All theseongoing important adjustment effortsin the euro areashould
restoreconfidencein the short-term and lead steadily back tosustainable
growth.
Thank you for your attention.
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Disclaimer
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Our goal is to keep this information timely and accurate. If errorsarebrought to our
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Solvency II SpeakersBureau
TheSolvencyII Association hasestablishedthe SolvencyII Speakers
Bureau for firmsand organizationsthat want to accesstheexpertiseof
Certified Solvencyii Professionals(CSiiPs) and Certified Solvencyii
EquivalenceProfessionals(CSiiEPs).
TheSolvencyII Association will be theliaison betweenour certified
professionalsand theseorganizations,at no cost. We stronglybelieve
that this can be a great opportunity for both, our certified professionals
andtheorganizers.
Tolearnmore:
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Course Title
Certified Solvency ii Professional (CSiiP):
Preparing for the Solvency ii Directive of the EU (3 days)
Objectives:
This coursehasbeen designed toprovidewiththe knowledgeand skills
needed to understand and support compliancewiththeSolvencyii
Directiveof theEuropean Union.
TargetAudience:
This course isintendedfor decision makers, managers, professionals
and consultantsthat:
A.Work in Insuranceor Reinsurancefirmsof EEAcountries.
B.Work in Groups- Financial Conglomerates(FC), Financial Holding
Companies(FHC), MixedFinancial Holding Companies
(MFHC), InsuranceHolding Companies(IH C) - providing insurance
and/ orreinsuranceservicesin theEEA, whoseparent islocatedin a
country of theEEA.
C.Want tounderstand thechallengesand the opportunitiesafter the
Solvencyii Directive.
This course ishighlyrecommendedfor supervisorsof EEA countries
that want to understand how countriesseeSolvencyII asa Competitive
Advantage.
This course is also recommended for all decision
makers, managers, professionalsand consultantsof insurance and/ or
reinsurancefirmsinvolved in risk and compliancemanagement.
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About the Course
INTRODUCTION
TheEuropean Union‟sLegislativeProcess
Directivesand Regulations
TheFinancial ServicesAction Plan (FSAP) of theEU
ExtraterritorialApplication of European Law
ExtraterritorialApplication of the SolvencyII Directive
Solvencyii and theLamfalussyProcess
Level 1: FrameworkPrinciples
Level 2: Detailed Technical MeasuresLevel3: Strengthening
CooperationAmong Regulators
Level 4: Enforcement
Weaknessesof SolvencyI
From SolvencyI toSolvencyII
Solvencyii Players
Solvencyii Objectives
THE SOLVENCY II DIRECTIVE
AUnified LegislativeBasisfor Prudential Regulation of Insurers
andReinsurers
Risk-BasedCapitalAllocation
Scope of theApplication
Important Definitions
Value-at-Riskin SolvencyII
Authorisation
CorporateGovernance
GovernanceFunctions
RiskManagement
CorporateGovernanceand Risk Management - Level 2
Fit and proper requirementsfor personswhoeffectivelyrun the
undertakingor haveother key functions
Internal Controls
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InternalAudit
Actuarial Function
Outsourcing
Board of Directors:Role and Solvencyii Responsibilities
12Principles– System of Governance (Level 2)
PILLAR 2
SupervisoryReview Process(SRP)
Focuson Risk Management and Operational Risk
Own Risk and SolvencyAssessment (ORSA)
ORSA- TheInternal Assessment Process
ORSA- TheSupervisoryTool
ORSA- Not a Third Solvency Capital Requirement
Capital add-on
PILLAR 3
DisclosureRequirements
TheSolvencyand Financial Condition Report (SFC)
PILLAR I
ValuationOf AssetsAnd LiabilitiesTechnicalProvisions
TheSolvencyCapital Requirement (SCR)
TheValue-at-RiskMeasureCalibratedtoa 99.5% Confidence
Level over a 1-year Time Horizon
TheStandardApproach
TheInternal Models
TheCollectionofAdditional HistoricalData
External Data
The Minimum Capital Requirement (MCR)
Non-CompliancewiththeMinimum Capital Requirement
Non-CompliancewiththeSolvencyCapital Requirement
Own Funds
Investment Rules
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INTERNAL MODEL APPROVAL
CEIOPSLevel 2 - Testsand Standardsfor Internal Model
Approval
CEIOPSLevel 2 - The procedure tobe followedfor theapproval of
an internal model
Internal ModelsGovernance
Group internal models
Statistical qualitystandards
Calibrationand validationstandards
Documentation standards
SOLVENCY II, GROUP SUPERVISION AND TH IRD COUNTRIES
SolvencyI: SoloPlusApproach
Group Supervisionunder SolvencyII
Rightsand dutiesof the group supervisor
Group Solvency - Methodsof calculation
Method1(Default method):Accounting consolidation-based
method
Method2 (Alternative method): Deduction and aggregation
method
Parent UndertakingsOutsidethe Community - Verification of
Equivalence
Parent UndertakingsOutsidethe Community - Absence of
Equivalence
Thehead of thegroup isin theEEA and the third country regime
is not equivalent
Thehead of thegroup isin theEEA and the third country regime
is equivalent
Thehead of thegroup isoutsidethe EEAand the third country is
not equivalent
Thehead of thegroup isoutsidethe EEAand the third country
regimeisequivalent
Small and Medium-SizedInsurers:TheProportionalityPrinciple
Captivesand SolvencyII
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EQUIVALENCE WITH SOLVENCY II AROUND THE WORLD
Solvencyii and Countriesoutsidethe European EconomicArea
TheInternationalAssociation of InsuranceSupervisors(IAIS)
TheSwissSolvencyTest (SST) and Solvencyii:
Solvencyii and theOffshoreFinancial Centers(OFCs)
Solvencyii and theUSA
Solvencyii and theUS NationalAssociation of Insurance
Commissioners(NAIC) - The Federal InsuranceOffice created
under the Dodd-Frank Wall Street Reform and Consumer
ProtectionAct in theUSA, and the ORSAin theUSA
FROM THE REINSURANCE DIRECTIVE TO THE SOLVENCY II
DIRECTIVE
Directive2005/ 68/ EC of 16November 2005on Reinsurance- The
ReinsuranceDirective(RID)
CLOSING
TheImpact of Solvencyii OutsidetheEEA
ProvidingInsuranceServicestotheEuropean Client
Competing withBanks
Learningfrom theBaselii Framework
RegulatoryArbitrage:AMajorRisk for Countriesthat see
Complianceasan Obligation, not anOpportunity
Basel II, Basel III, SolvencyII and RegulatoryArbitrage
Challengesand Opportunities:What is next
RegulatoryShopping after SolvencyII
Tolearnmore about thecourse:
www.solvency-ii-association.com/ Certified_Solvency_ii_Training.htm
Solvency ii Association
www.solvency-ii-association.com
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Solvency ii Association
www.solvency-ii-association.com