Regulator Covid-19 update 28 April

On 28 April:

• FCA updated its guidance on changes to regulatory reporting; and
• The European Commission has announced a wide-ranging banking package to help banks to lend to support the economy.  The package includes:
  • adapting the timeline for Basel 3.1 and IFRS 9 application;
  • encouraging banks and supervisors to make use of flexibility within rules and using them to act responsibly – including on how banks assess a borrower’s ability to repay;
  • clarifications on how to treat the various payment moratoria that have been granted – in particular that they should not automatically be considered a significant increase in credit risk;
  • guidance on how the prudential rules on classification of non-performing loans can accommodate the payment freezes;
  • giving more favourable treatment to public guarantees granted during the crisis;
  • postponing the date of the leverage ratio buffer;
  • modifying the way in which certain exposures are excluded from the leverage ratio calculation; and
  • bringing forwards the date of application of various measures to encourage infrastructure, SME and employee financing packages.