RiskTech Forum

EBA and ESMA Call to Clarify Margin Requirements Between CRR and EMIR

Posted: 18 January 2017  |  Source: ESMA


The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) published today their joint report on the functioning of the Capital Requirements Regulation (EU) No 575/2013  (CRR) with the European Market Infrastructure Regulation (EU) No 648/2012  (EMIR).

The report calls for the requirements for credit, market, and counterparty credit risk in the CRR to be clarified. This clarification should ensure that only risks not already covered by specific financial resources for activities not related to clearing are to be covered by CRR requirements. This exclusion should also be extended to activities covered by interoperability arrangements.

In the Report, the EBA and ESMA have focused their analysis on a list of specific issues concerning the mandate of article 515(1) of the CRR, and in particular with regard to institutions operating a central counterparty (CCP). The recommendations included in the Report aim at avoiding duplication of requirements for derivative transactions and thereby avoid increased regulatory risk and increased costs for monitoring by Competent Authorities. In particular, the following topics have been addressed in the Report: (a) Capital requirements for CCPs holding a banking licence; (b) Leverage and liquidity for CCPs; (c) Large exposures; (d) Difference in MPoR application; (e) Clients’ exposures to clearing members.

Legal framework and background

The Report has been developed on the basis of articles 515(1) of the Regulation 575/2013  of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms (CRR).

In developing this report, the EBA and the ESMA have organised an ad-hoc meeting aiming at collecting stakeholders’ opinions on the functioning of the CRR with respect the EMIR.​