Capital Markets

Capital Markets Blog

ECB extends its TLTRO III financing program

Introduction

On December 10, 2020, the European Central Bank (ECB) extended the third series of its targeted longer-term refinancing operations (TLTRO III) as a further countermeasure to COVID-19 impacts on the capital markets. The aim of further extending the funding channel by three additional bidding dates (TLTRO III 8-10) is to further stimulate an increase in banks’ net lending and thus channel more liquidity to the real economy. The changes entered into force in February 2021 and brought certain relaxation of past criteria as well as a simplification of interest rate calculation which we will discuss in this article.

Technologie als Change Enabler im Kapitalmarkt – elektronische Wertpapiere und Crypto Assets als neue Assetklasse?

Die Akteure in Kapitalmärkten sind in einem sich ändernden Ökosystem einer Vielzahl an Herausforderungen ausgesetzt. In Zeiten von höheren Kosten durch stets zunehmende Regulierung sowie Anpassungsbedarf in post-Covid Betriebsmodellen, sollen technologische Neuerungen und die Digitalisierung Abläufe vereinfachen und effizienter machen. Technologie dient in den kommenden Jahren aber auch als Enabler für disruptive Produkte, Services und Geschäftsmodelle sowie als Katalysator für neue Akteure im Kapitalmarkt. Insbesondere Multi-Asset & Digitale Plattformen, SaaS & Utilities, Big Data und AI, sowie Cloud und Cyber gelten hier als aktuelle Trends.

Einer der innovativsten technologischen Trends der letzten Jahre ist der Einsatz von Distributed Ledger Technology (DLT). Durch die Nutzung von DLT ist es bereits heute möglich, Wertpapiere digital zu begeben als sogenannte Kryptowertpapiere (Crypto Assets). Crypto Asset meint hierbei eine digitale Abbildung eines Wertes oder Rechts, welches elektronisch auf einem Distributed Ledger verwahrt und transferiert werden kann1. Derzeit gibt es über 5.200 Crypto Assets weltweit und die Anzahl an innovativen Crypto Assets steigt rapide an. Dabei decken diese bereits jetzt eine breite Anzahl an Anwendungsfällen, beispielsweise im Bereich Fundraising, Unternehmensfinanzierung (ICO), Immobilien und Übertragung von Rechten und Eigentum (STO), sowie den Handel dieser ab.

ECB Asset Purchase Programs as a Liquidity Source and an Instrument in Times of Crisis

1. Introduction

The response of the European Central Bank (ECB) to the economic disruptions caused by the coronavirus is the Pandemic Emergency Purchase Program (PEPP). As in the financial and European debt crisis of 2007 onwards, the massive purchase of securities by the ECB is intended to “counter the serious risks to the monetary policy transmission mechanism and the outlook for the euro area posed by the coronavirus outbreak”. This article focuses on the background of asset purchase programs which can be used by institutions as a source of liquidity. In addition, this paper examines both the qualitative and quantitative differences between the PEPP and ECB’s previous purchase programs and provides an outlook on further development of this funding vehicle.

Bewertung in der Abwicklung und BaFin Konsultation MaBewertung

Seit einiger Zeit rückt das Thema Bewertung in der Abwicklung sowie die dafür erforderliche Informationsbereitstellung zunehmend in den Fokus der Abwicklungsbehörden.

Auf europäischer Ebene haben die European Banking Authority (EBA) mit dem “EBA Handbook on valuation for purposes of resolution” inkl. Data Dictionary und das Single Resolution Board (SRB) mit seinem „SRB Framework for valuation“ bereits im vergangenen Jahr Leitlinien zur Methodik für die Bewertung in der Abwicklung veröffentlicht (vgl. auch Newsflash 8/2019 sowie unser Blogpost vom 20. Dezember 2019[1]). Das SRB hat zudem am 19. Mai 2020 ein Konsultationspapier zum „SRB Standardized Valuation Data Set“ veröffentlicht, welches zum Ziel hat, ein gemeinsames Verständnis in Bezug auf den Datenbedarf für die Bewertung in der Abwicklung zu gewährleisten.

ESMA Templates and Securitization Repository RTS Enter into Force

On September 3, 2020, the remaining regulatory technical standards (RTS) of the Securitization Regulation completed their scrutiny period and were confirmed and published by the European Parliament in the Official Journal[1]. This legislative act comes one year and nine months after the Securitization Regulation formally entered into force and thus formalistically completes the transition from the current regulatory regime into the new one. The approved RTS will enter into force on September 23, 2020 and will bring substantial changes to the market mechanics. The following text was compiled in order to help the reader to better understand the market impact.

Financial Services Post-Brexit: The Age of Equivalence

With Brexit carried out on 31st January, 2020, the clock for the negotiations on the future of the economic relationship between the UK and the EU started ticking aloud. Before bilateral, structured meetings formally kicked off on 2nd March 2020, both sides had already started indirect communication by formulating a Blueprint (PM Johnson) and a negotiation mandate (of the European council for Commissioner Barnier) aiming at setting the scene for later direct talks. Both sides have stated that Financial Services will be on the table, which is not a surprise. If we think of the negotiations as a dinner table, Financial Services would be the Lobster: After use of some tools and techniques (both themselves taking some time to get learned), you get a non-everyday culinary experience (at least for most of us). You will possibly remember a meal for the Lobster served. But If you are hungry and in a hurry, you will probably not choose the lobster, deprioritizing it to the most important target at hand: Not leaving the table hungry.

As of now, Financial Services could well become the Lobster in the Brexit negotiation: The masterpiece of negotiations, but unavailable for time constraints. Instead, it is more likely than not that EU-UK-cross-border financial services from 2021 on will be governed by a concept which is already established in both EU and UK law and will thus not require negotiations: Equivalence.

In this article, we will explain the concept of equivalence, why we consider it the most probable outcome and what this means for the provision of cross-EU-UK-border (cross-border) financial services after the end of the transition period, in the short and medium term.

PwC Live-Webcast: Responding to the impacts of COVID-19

The current CoViD-19 situation is evolving dynamically. While the immediate focus is on making sure that as many people can be treated medically in appropriate and life saving ways, business matters come to the fore due to more and more constraints and interrupted supply chains and subsequent impact on financial institutions’ business models.

How are businesses coping with the situation globally? Which conclusions can be drawn so far? What should businesses look at to react effectively, protect employees and maintain their brand value?

Those and further issues will be discussed in our live webcast “Responding to the impacts of CoViD-19” on March 19, 2020 at 2pm CET to which we would like to invite you.

Please register here.

Details

When: Thursday March 19, 2020 | 2.00 – 2.45pm CET (webcast opens 1:55pm CET)

Please feel free to share and forward the invite with colleagues and employees who are involved in your task forces.

Your questions

You are invited to ask our experts live during the webcast. Alternatively, you can submit questions upfront to tobias.bremser@pwc.com

 

We are looking forward to welcome you and your colleagues to the webcast.

Integration von FinTechs in das Risikomanagement von Banken

Der digitale Wandel trifft den Finanzsektor derzeit stark. Bankkunden verlangen mehr und mehr digitale Dienstleistungen von „ihrer“ Hausbank. Banken müssen somit neue digitale Dienstleistungen für ihre Kunden entwickeln und gleichzeitig ihre veraltete IT und Prozesse modernisieren. In diese „Lücke“ sind nun die FinTechs getreten und rauben den etablierten Banken nach und nach Marktanteile.

Banken sind somit gezwungen, schnellstmöglich digital „nachzurüsten“ – sowohl bei ihrem digitalen Kundenangebot als auch bei den eigenen Prozessen. Zusätzlich bieten sich dadurch im derzeitigen Niedrig-Zinsumfeld wiederum neue Ertragsquellen und Wachstumschancen. Aktuell besteht eine hohe Investitionsbereitschaft im Bereich Digitalisierung, insbesondere im Private Banking, Wealth Management und Transaction Banking.