- UK Finance respond to UK Government White Paper on Brexit
- UK FInance publishes Mortgage Trends Update
- Capgemini report reveals that the financial services industry could expect to add up to $512bn to global revenues by 2020 through ‘intelligent automation’
- Banking Trojans global impact has increased by 50% in last four months
- Emma Technologies FinTech raises £420,000 in seed funding
- Liberis uses Open Banking technology to increase funding access for UK small businesses
- Moneybox closes a £14m Series B funding expired
- Visa Loyalty Solutions(VLS) with FinTech novae launches omnichannel digital points redemption platform available to all issuing banks in Latin America and the Caribbean expired
- Bank of Cyprus completes sale of UK subsidiary to Cynergy Capital expired
- Capital Dynamics to acquire Milan-based Advanced Capital SGR expired
- EQT and other co-investors agree to acquire Saxo Payments Banking Circle from Saxo Bank expired
- Frontierpay opens Asia HQ in Singapore expired
17th April 2018
EU financial regulators warn against multiple risks for EU financial markets
The securities, banking and insurance sectors in the European Union (EU) face multiple risks, the latest report on risks and vulnerabilities by the Joint Committee of the European Supervisory Authorities (ESAs) shows.
The ESA report for the second half of 2017 outlines the following risks as potential sources of instability:
• Sudden repricing of ‘risk premia’ as witnessed by the recent spike in volatility and associated market corrections.
• Uncertainties around the terms of the UK's withdrawal from the EU.
The ESA report also reiterates their warning to retail investors investing in virtual currencies and raises awareness for risks related to climate change and the transition to a lower-carbon economy.
In light of the ongoing risks and uncertainties, especially those around Brexit, supervisory vigilance and cooperation across all sectors remains key. Therefore, the ESAs advise the following policy actions by European and national competent authorities as well as financial institutions:
• Against the backdrop of the potential for sudden ‘risk premia’ reversals, supervisory stress testing remains a crucial tool for the management of systemic risk – these tests are to ensure that systemically relevant sectors and players are safe to withstand market shocks, such as insurance and occupational pensions sectors, central counterparties (CCP), banks and in the future asset managers.
• Brexit: the ESAs recommend EU financial institutions and their counterparties, as well as investors and retail consumers, to consider timely mitigation actions to prepare for the UK's withdrawal from the EU – including possible relocations and actions to address contract continuity risks.
• Cyber security: the ESAs encourage financial institutions to improve fragile IT systems, explore inherent risks to information security, connectivity and outsourcing. To support this, the ESAs will continue addressing cyber risks for securities, banking and insurance markets and monitor firms' use of cloud computing and potential build-up of cyber risks.
• Climate change: the ESAs recommend financial institutions to consider sustainability risk in their governance and risk management frameworks and to develop responsible, sustainable financial products – moreover, supervisors should enhance their analysis of potential risks related to climate change for the financial sector and financial stability.