Global Trustee and Fiduciary Services Bite-Sized Issue 11 2024

3 QUICK LINKS CULTURE CRYPTOASSETS ELTIFS EMIR FINANCIAL STABILITY BOARD FINTECH MIFID II/MIFIR OPERATIONAL RESILIENCE SUSTAINABILITY T+1 ASIA/PACIFIC EUROPE LUXEMBOURG NORTH AMERICA UNITED KINGDOM Global Trustee and Fiduciary Services Bite-Sized | Issue 11 | 2024 The EC adds that the finalisation of the ELTIF 2.0 reform is expected to stimulate long-term investments in Europe. It marks a turning point for many national investment funds, which aremostly marketed domestically, and therefore are unable to fully reap the benefits of the Single Market. Link to European Commission Newsletter here EMIR EBA Asks for Input to Entities FallingWithin the Scope of Initial Margin Model Authorisation Under the Revised EMIR On 29 October 2024, the European Banking Authority (EBA), in cooperation with the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA), launched a short survey addressed to entities within the scope of the initial margin (IM) model authorisation regime introduced by the upcoming revised European Market Infrastructure Regulation (EMIR 3). EMIR 3 will introduce: • An authorisation regime for IMmodels used by counterparties in the EU; • A new EBA central validation function for pro-forma margin models (such as ISDA SIMM); and • A supervision of IMmodels with greater focus on larger counterparties. The EBA, in cooperation with ESMA and EIOPA, is seeking general information on entities within the scope of IMmodel authorisation, as well as specific information relevant for fee calculation and on initial margins and IMmodels used. The EBA says that this information will guide it in the setup of its central validation function and inform the EBA’s response to the EU Commission’s Call for advice on a possible Delegated Act on fees received on 31 July 2024. The information will also be used to develop proportionate requirements for entities within the scope of IMmodel authorisation, especially for smaller entities (the so called “Phase 5” and “Phase 6” entities) - as part of upcoming mandates under EMIR 3. Entities currently subject to the requirement to exchange initial margin – in accordance with EMIR and under Article 36 of Commission Delegated Regulation (EU) 2016/2251 (the joint ESAs RTS on uncleared OTC derivatives) - and using at least one IMmodel to comply with that requirement, are expected to fill in the survey. All entities of a group that are subject to this requirement are expected to fill in the survey separately, at entity level. The deadline for submitting responses is 29 November 2024. Link to Survey here FINANCIAL STABILITY BOARD FSB Analyses Interest Rate and Liquidity Risks and the Role of Technology and Social Media on Depositor Behaviour On 23 October 2024, the Financial Stability Board (FSB) published a report on depositor behaviour and interest rate and liquidity risks in the financial system, drawing on lessons from the March 2023 banking turmoil. The report summarises the main findings from FSB work over the past year to assess vulnerabilities in the global financial system related to solvency and liquidity risks amid rising interest rates, the influence of technology and social media on depositor behaviour during bank runs, and how the use of technologies may affect the planning and execution of a resolution. The FSB says that the analysis identifies life insurers, non-bank real estate investors – comprising real estate investment trusts, real estate funds, and other nonbank mortgage lenders – as well as a weak tail of banks as most vulnerable to solvency and liquidity risks at the current juncture. The Reports says that these entity types typically have a high proportion of interest rate-sensitive assets and liabilities and are affected by higher rates through various solvency and liquidity risk channels.

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