CONSULTATION RESPONSE
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ESMA consultation on amendments to MAR Guidelines on delayed disclosure of inside information: EBF response

BRUSSELS, 6 September 2021 –

The EBF has responded to the consultation of the European Securities and Markets Authority on its Guidelines on delayed disclosure of inside information under the Market Abuse Regulation (MAR) in relation to its interaction with prudential supervision.

In its response, the EBF has highlighted the following key points:

• Regarding the disclosure of decisions regarding redemptions, reductions and repurchases of own funds instruments, the EBF would like to state that this information should only be treated as inside information once the authorisation of the Prudential Competent Authority has been granted, and, in addition, the institution has sufficient certainty that the redemption, reduction and repurchase of own funds will take place. The same reasoning should apply to other decisions where the approval of a committee, third-party or authority is still pending.
• Regarding the disclosure of draft SREP decisions, it should be noted that draft SREP decisions in the view of the EBF do not yet meet the requirement for precision to be qualified as inside information. It is only that they can be seen as representing precise information once the dialogue with the supervisor has been concluded and the final SREP letter is received, which also details the measures that the bank has to comply with in the end. Other supervisory measures (question 8 of the consultation paper) should be subject to a case-by-case assessment.
• Regarding the disclosure of the Pillar 2 Requirement (P2R), the EBF would like to stress that there is already extensive disclosure of this information as part of the Pillar 3 disclosures. A case-by-case assessment about the actual price sensitivity of this information is a more appropriate approach.
• Regarding the disclosure of Pillar 2 Guidance (P2G), the EBF considers that as a matter of principle P2G should not be considered as inside information, due to the fact that this is a non-binding requirement. P2G does not have any impact on the maximum distributable amount (MDA) of an issuer. Instead, a non-disclosure of this information would ensure that the P2G remains an important instrument in the supervisory dialogue. This is best accomplished if it remains confidential and also aligned with the spirit of the regulation. Finally, it is also important to remark that is a very common situation that institutions meet their P2G and that those situations should not be considered as exceptional.

Lastly, where information needs to be assessed on a case-by-case basis regarding its potential status as inside information, it is important to also reflect on the issuer’s responsibility to assess this. Therefore, we would hope that this could also be reflected better in the language of the ESMA communication.

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FOR MORE INFORMATION:

Lukas Bornemann,  Policy Adviser – Prudential Policy & Supervision, l.bornamann@ebf.eu

ABOUT THE EBF:

The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The EBF is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu