We discuss a wide range of policy and supervisory updates pertaining to global financial markets in this week’s regulatory roundup. This edition demonstrates how regulators are continuously improving their approaches to transparency, consumer protection, market stability, and sustainability, from conduct-focused reforms and risk management improvements to ESG disclosures and changing compliance frameworks. This blog offers crucial insights to assist financial institutions in navigating the complexity of regulations, whether you’re monitoring changes in banking, insurance, investments, or digital assets.
Business Line | Country | Regulator | Regulatory Update | Summary |
All | European Union | European Union | Directive to Strengthen Oversight of Central Counterparty Risks in Cleared Derivatives | The European Parliament and Council have adopted a new directive amending Directives 2009/65/EC (UCITS), 2013/36/EU (CRD), and 2019/2034 (IFD) to enhance the regulatory treatment of concentration and counterparty risks in centrally cleared derivative transactions. The amendments align these frameworks with the revised EMIR rules (Regulation 648/2012), particularly in relation to exposures toward central counterparties (CCPs), including systemically important third-country CCPs (Tier 2 CCPs). UCITS will now be exempt from counterparty risk limits when clearing through authorised or recognised CCPs. Credit institutions and investment firms must implement specific risk management strategies—including quantifiable targets and stress-testing methodologies—to monitor exposures to CCPs offering services of substantial systemic importance. Supervisory authorities are also empowered to intervene where excessive concentration risks are identified. The directive supports the EU’s broader Capital Markets Union (CMU) goals by encouraging central clearing and reinforcing the stability of EU financial markets. |
European Union | European Union | The European Parliament and Council have adopted Regulation (EU) 2024/… to establish a harmonised legal framework governing Environmental, Social and Governance (ESG) rating activities. The regulation introduces mandatory authorisation and registration requirements for ESG rating providers operating within the EU and sets organisational, transparency, and disclosure standards to enhance the integrity and comparability of ESG ratings. It amends existing legislation, including Regulations (EU) 2019/2088 and 2023/2859, to integrate ESG ratings more effectively into sustainable finance practices. The regulation mandates ESG rating providers to disclose methodologies, data sources, and potential conflicts of interest, while ensuring their independence from undue influences. Additionally, ESMA is tasked with supervisory responsibilities and will maintain a public register of authorised and recognised providers. Transitional provisions allow existing providers to apply for authorisation within defined timeframes, with enforcement starting 18 months from the regulation’s entry into force | ||
Japan | JFSA | Japan’s Financial Services Agency (FSA) has published a public comment summary and its responses regarding the discussion paper on “Issues and Practices for Dialogue on Validation of Effectiveness of AML/CFT Frameworks.” This document clarifies supervisory expectations around how financial institutions should internally validate the effectiveness of their anti-money laundering (AML) and counter-financing of terrorism (CFT) systems. It affirms that institutions must ensure their frameworks are risk-based, well-resourced, and continuously improved. Importantly, the FSA acknowledges flexibility in validation practices, particularly for smaller or international institutions, and emphasises that validation need not be entirely independent if performed competently. Through structured dialogues, including input from boards, compliance, and internal audit, the FSA aims to support reasonable and objective AML/CFT implementation without enforcing a prescriptive checklist approach. | ||
Luxembourg | CSSF | The Commission de Surveillance du Secteur Financier (CSSF) has released an updated user guide detailing the reporting process for EBA-mandated remuneration data collection exercises, effective 31 March 2025. The guide outlines technical and procedural requirements for CRR institutions and non-SNI IFR investment firms subject to reporting obligations under various EBA Guidelines. These include remuneration benchmarking, high earners disclosure, approved higher ratios, gender pay gap analysis, and diversity benchmarking. Reports must be submitted in XBRL-XML format via the CSSF’s S3 protocol or the eDesk platform, with strict file naming, authentication, and validation protocols. The update also includes clarified roles for designated “Human Resources responsible” and “IT Experts,” formal error handling procedures, and justifications for warnings. This framework reinforces CSSF’s alignment with EBA guidelines and aims to ensure data quality, transparency, and regulatory consistency. | ||
New Zealand | FMA | CoFI Regime Takes Full Effect to Elevate Consumer-Centric Conduct | New Zealand’s Conduct of Financial Institutions (CoFI) regime has officially come into force, marking a significant shift toward prioritising fair treatment of consumers by banks, insurers, and non-bank deposit takers. Under the oversight of the Financial Markets Authority (FMA), licensed financial institutions are now required to implement and publicly disclose fair conduct programmes that embed the fair conduct principle into their operations. This includes regularly assessing product performance, maintaining effective consumer communication, and swiftly addressing any issues. The FMA’s supervisory approach under CoFI is principles-based and outcomes-focused, employing a range of tools—from engagement and monitoring to thematic reviews—to ensure that financial services align with consumer needs and expectations. The regime stems from earlier conduct and culture reviews and expands the FMA’s authority across licensing, monitoring, and enforcement to restore and reinforce consumer trust in the financial sector. | |
Banking | Chile | CMF | Performance of supervised banks and cooperatives as of February 2025 | The Comisión para el Mercado Financiero (CMF) of Chile has released performance data for banks and supervised cooperatives as of February 2025. The banking sector recorded a 1.87% year-on-year contraction in total loan placements, largely due to declines in commercial (-3.96%) and consumer (-0.76%) loans, although mortgage lending rose by 1.28%. Credit risk indicators showed improvement across provisions, 90-day delinquencies, and deteriorated loan portfolios, though these indicators rose year-over-year. Banks reported a monthly profit of CLP 557.96 billion (USD 592 million)—a 77.33% monthly and 16.67% annual increase—with return on equity (ROE) at 15.53% and return on assets (ROA) at 1.30%. In contrast, credit unions (cooperatives) saw a 6.71% annual increase in loan placements, driven primarily by a 5.02% rise in consumer loans. Despite monthly increases in all credit risk indicators, cooperatives posted a remarkable 334.81% profit growth from January, totaling CLP 12.96 billion (USD 14 million), with improved ROE and ROA of 13.15% and 2.81%, respectively. |
European Union | EBA | The European Banking Authority (EBA) has released the results of its 2024 benchmarking exercises assessing internal models used by EU banks for credit and market risk under the Capital Requirements Directive (CRD). The credit risk benchmarking revealed wide variability in risk-weighted assets (RWA) driven by modelling choices, particularly in low-default portfolios such as sovereign and corporate exposures, with some institutions flagged for potential underestimation of capital requirements. The market risk benchmarking under the Internal Model Approach (IMA) identified improvements in data quality but highlighted significant dispersion in stressed Value-at-Risk (sVaR) and Incremental Risk Charge (IRC) figures, partly due to divergent modelling assumptions and stress period selections. For the Alternative Standardised Approach (ASA), the benchmarking marked its third year of data collection, expanding to include new sensitivities and default risk charge (DRC) metrics. The EBA emphasised that supervisory follow-up will be required for banks with unexplained outliers and highlighted the need for ongoing model enhancements and better alignment with the forthcoming FRTB (Fundamental Review of the Trading Book) framework. | ||
European Union | European Commission | The European Commission has proposed to amend the Capital Requirements Regulation (EU) No 575/2013 to permanently maintain the current transitional Net Stable Funding Ratio (NSFR) treatment for short-term securities financing transactions (SFTs) and unsecured transactions with financial customers. Originally set to expire in June 2025, the transitional provision allows a lower Required Stable Funding (RSF) factor, particularly for transactions collateralised by sovereign debt. This adjustment aims to support liquidity in EU sovereign debt and collateral markets, preserve the competitiveness of EU banks in international repo and SFT markets, and avoid disruptions to monetary policy transmission. The Commission argues that increasing the RSF as per the Basel III standards would undermine EU financial stability and market depth, especially as other key jurisdictions like the US, UK, Japan, and Switzerland have made similar transitional arrangements permanent. The proposal also introduces a requirement for the European Banking Authority to assess the impact of this treatment every five years, ensuring continued alignment with international standards and market realities. | ||
Hong Kong | HKMA | The Hong Kong Monetary Authority (HKMA) has introduced the Banking Regulatory Document Repository (BRDR), a new digital platform designed to streamline access to banking regulatory documents. The BRDR comprises two web portals—one public-facing and one for Authorized Institutions (AIs)—that offer improved search functionality, intuitive navigation, and a unified location for accessing key regulatory materials such as guidelines, circulars, and codes of practice. Starting 11 April 2025, existing regulatory document links on the HKMA website will be phased out and redirected to the new repository, ensuring continuity and ease of access. The initiative reflects HKMA’s commitment to enhancing transparency, usability, and communication with stakeholders in the banking sector. | ||
Israel | BOI | New Disclosure Requirements to Boost Deposit Market Competition | A new directive from the Bank of Israel, effective 1 April 2025, mandates all banks to publish deposit and credit balance interest rates in a uniform, centralised, and accessible format. This move, part of Proper Conduct of Banking Business Directive No. 447, aims to increase market transparency and empower consumers with clearer comparisons of deposit offerings. Banks are now required to display minimum offered rates for common deposit types across their websites, mobile apps, and physical branches. Additionally, banks must provide a searchable digital tool to help customers identify deposit options that meet their needs. The regulation supports Israel’s broader initiative to enhance competition in the banking sector through transparency and consumer empowerment. | |
Portugal | BDP | The Banco de Portugal’s March 2025 report highlights the continued effectiveness of its macroprudential measures aimed at preserving financial stability, particularly in the residential mortgage market. Key instruments include strict limits on loan-to-value (LTV) and debt-service-to-income (DSTI) ratios, loan maturities, and the requirement for regular repayments. In 2024, the average LTV ratio held at 69% and the average DSTI ratio dropped to 26.1%, driven by lower interest rates and rising household incomes. Younger borrowers (under 35) increasingly accessed home loans, supported by state-backed guarantees, although their participation is carefully monitored to maintain systemic resilience. Capital buffer requirements were also reinforced, with sectoral systemic risk buffers and the introduction of a 0.75% countercyclical capital buffer (effective January 2026). Collectively, these measures have reduced high-risk lending, improved borrower risk profiles, and ensured that Portuguese banks maintain substantial capital buffers to absorb future shocks. | ||
United Kingdom | BOE | The Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) have launched a consultation (CP6/25) proposing to raise the de minimis threshold for the Loan to Income (LTI) flow limit in mortgage lending from £100 million to £150 million per annum. The LTI flow limit currently caps the proportion of new residential mortgage loans with LTI ratios of 4.5 or higher at 15% of a lender’s annual origination volume. By increasing the threshold, small mortgage lenders will be able to grow their residential lending portfolios without immediately triggering the LTI limit, promoting competition and supporting market diversity. This adjustment follows the Financial Policy Committee’s November 2024 recommendation and aligns with regulators’ secondary objectives of competitiveness and growth. The consultation closes on 8 May 2025, with final rules expected in the second half of the year. | ||
United Kingdom | BOE | Regulatory Framework for Credit Union Service Organisations (CUSOs) | The Prudential Regulation Authority (PRA) has announced its intention to consult on proposed rule changes to clarify the regulatory treatment of Credit Union Service Organisations (CUSOs) in the UK. While CUSOs—entities owned by credit unions to provide shared administrative and professional services—offer operational efficiencies and access to expertise, ambiguity in current legislation and PRA rules has raised questions about credit unions’ ability to invest in them. The PRA aims to amend Rules 6.3 and 6.4 of the Credit Unions Part of the Rulebook to explicitly allow investment of surplus funds in CUSOs, provided legislative requirements are met. The forthcoming consultation will also propose risk management expectations, including limits on liability, due diligence requirements, and robust outsourcing oversight. These updates seek to support innovation and sustainability in the credit union sector while ensuring regulatory safeguards are upheld. | |
United Kingdom | BOE | UK Proposes Stronger FSCS Protections and Resolution Tools to Bolster Depositor Confidence | The Prudential Regulation Authority (PRA) has launched Consultation Paper CP4/25 proposing significant enhancements to the UK’s depositor protection framework. Key proposals include raising the Financial Services Compensation Scheme (FSCS) deposit protection limit from £85,000 to £110,000 and increasing the temporary high balance (THB) limit from £1 million to £1.4 million, both effective from 1 December 2025. These adjustments aim to counter inflationary erosion, strengthen depositor confidence, and reduce liquidity risk in times of stress. The paper also outlines changes to disclosure obligations, SCV system updates, and a six-month transition window for firms to reflect new limits. Additionally, in response to the Bank Resolution (Recapitalisation) Bill, the PRA proposes new rules enabling the FSCS to use industry levies to recapitalise failing banks where public interest justifies resolution. Together, these reforms are intended to reinforce financial system stability, particularly in managing smaller bank failures, while enhancing transparency and consumer protection across the sector. | |
Insurance | China | Insurance Association | Bidding for ESG Disclosure Interpretation and Case Study Publication | The China Insurance Association has initiated the procurement process for the publication and printing of the “Interpretation and Case Studies on the Guidelines for ESG Information Disclosure by Insurance Institutions,” aiming to support the implementation of national financial strategies focused on environmental, social, and governance (ESG) performance. The project involves publishing 1,000 paperback copies of the 80,000-word document and is open to qualified domestic suppliers capable of meeting stringent regulatory and production standards. Eligible bidders must be registered within China, possess relevant licenses, demonstrate financial integrity, and submit all required documentation—including tax and social security compliance records—by April 14, 2025. The bidding will take place on April 15, 2025, in Beijing. This initiative reflects the broader push to improve ESG transparency and accountability within China’s insurance sector. |
Singapore | MAS | The Monetary Authority of Singapore (MAS) has issued an updated Compliance Toolkit for Insurance Brokers (IBs), effective 1 April 2025, detailing key regulatory obligations under the Insurance Act 1966 and its subsidiary legislation. The toolkit consolidates application processes, notification protocols, and reporting requirements across registered, exempt, and approved insurance brokers. Key enhancements include structured guidance on MAS-Tx platform submissions, expanded breach and misconduct reporting obligations, and annual attestation for risk placements with unlicensed insurers. It also outlines responsibilities under Notices 502 and 504 concerning professional standards and staff conduct. The comprehensive reference tool aims to improve regulatory transparency, facilitate timely compliance, and ensure insurance brokers uphold high standards of governance and risk management. | ||
Investment | Australia | ASIC | The Australian Securities and Investments Commission (ASIC) has released Regulatory Guide 280: Sustainability Reporting (RG 280), providing detailed guidance for entities required to prepare climate-related financial disclosures under Chapter 2M of the Corporations Act 2001. This follows a comprehensive public consultation process and applies to companies, registered schemes, superannuation entities, and retail corporate collective investment vehicles. RG 280 clarifies reporting thresholds, required content, and expectations for disclosures both within and outside the sustainability report, such as in product disclosure statements. Notably, ASIC has included enhanced guidance on climate scenario analysis, scope 3 emissions, director responsibilities, and the labelling of sustainability-related information. The regulator also outlined a proportionate and supportive enforcement approach as reporting obligations are phased in from January 2025. Additionally, ASIC has allowed stapled entities to file consolidated reports and has issued REP 809 summarizing stakeholder feedback incorporated into RG 280. | |
Cayman Islands | CIMA | Effective 1 April 2025, the Cayman Islands Monetary Authority (CIMA) has launched Phase Two of its Virtual Asset Service Providers (VASP) legislative framework, introducing mandatory licensing requirements for entities offering virtual asset custody and trading platform services. These changes, supported by amendments to the VASP Act, aim to enhance regulatory oversight and apply to all VASPs operating in or from the Cayman Islands. The updated framework requires such VASPs to hold a license, while other virtual asset services will continue to require registration—unless granted a waiver. Entities must comply with enhanced prudential standards, updated definitions, a minimum board composition of three directors, and non-refundable application fees. Registered VASPs conducting licensable services have a 90-day window to apply for a license, and new applicants must submit documentation via the REEFS portal. CIMA has also introduced a waiver process for supervised persons already regulated under other laws. Non-compliance may result in penalties and enforcement actions. Additional guidance will follow to support entities during the transition. | ||
European Union | ESMA | ESMA has released a consultation paper proposing significant revisions to the transparency framework for derivatives under the MiFIR review, aiming to streamline and stabilize pre- and post-trade transparency obligations. Key changes include the transition from a dynamic to a static liquidity determination model for derivatives, which reduces reporting burdens by eliminating daily submissions to the FITRS system. The scope of instruments subject to transparency is expanded to include exchange-traded derivatives (ETDs) and a targeted set of OTC derivatives—primarily those subject to EMIR clearing obligations or centrally cleared. ESMA introduces tailored pre-trade transparency requirements applicable only to trading venues operating central limit order books (CLOBs) or periodic auctions. Additionally, a revised deferral regime for post-trade reporting replaces previous large-in-scale and size-specific-to-instrument waivers with five standard deferral categories calibrated by liquidity and trade size. The consultation also proposes amendments to the RTS on package orders to align with the revised scope and introduces specific reporting standards for the upcoming derivatives consolidated tape. These proposals seek to improve data quality, reduce complexity, and enhance price discovery across EU derivatives markets. | ||
European Union | ESMA | Consultation on Expanded Use of Alleviated Insider List Format Under Market Abuse Regulation | As part of its mandate under the EU’s Listing Act, the European Securities and Markets Authority (ESMA) has launched a consultation on draft Implementing Technical Standards (ITS) aimed at simplifying insider list requirements under the Market Abuse Regulation (MAR). The proposed ITS would extend the alleviated format—currently applicable only to SMEs listed on growth markets (SME GMs)—to all issuers, including large, listed firms. This change is designed to reduce administrative burdens while ensuring competent authorities still receive essential information for market abuse investigations. The updated templates remove certain personal data fields, such as home address and personal phone numbers, while maintaining key identifiers like national ID or birthdate. The proposed framework retains event-based and permanent insider list sections but streamlines data collection requirements. ESMA’s consultation is open until 3 June 2025, with final ITS expected by Q4 2025. If adopted, this would mark a notable shift toward regulatory proportionality in line with the EU’s broader capital markets union goals. | |
European Union | EBA | The European Supervisory Authorities (EBA, EIOPA, and ESMA) have published a joint report evaluating the effectiveness of the Securitisation Regulation (EU) 2017/2402. While the regulation has enhanced transparency and market functioning since its implementation, the report highlights several areas for improvement. Notably, the current simple, transparent, and standardised (STS) framework is seen as overly complex and costly, deterring wider adoption. The Joint Committee recommends streamlining due diligence obligations, recalibrating disclosure templates for private transactions, and adjusting the prudential treatment of securitisation for insurers and pension funds. These suggestions aim to boost market activity while maintaining safeguards and financial stability across the EU. | ||
Luxembourg | CSSF | The Commission de Surveillance du Secteur Financier (CSSF) has released the latest version of its Reporting Handbook for Investment Firms, dated 31 March 2025. This update introduces minor adjustments to IFR templates applicable to Class 2 investment firms and provides greater precision regarding adjusted reporting reference and remittance dates. The Handbook aligns national and EU-level reporting requirements under the Investment Firm Regulation (IFR) and Directive (IFD), distinguishing obligations for Class 2 and Class 3 investment firms, including those reporting on an individual or consolidated basis. Significant technical updates include the integration of EBA Reporting Framework V4.0, detailed XBRL submission guidance, security protocols, and strict versioning conventions for preliminary and audited reports. This revision ensures continued harmonisation with evolving EU supervisory standards while maintaining proportionality across firm types. | ||
Philippines | SEC | Philippines Eases Investment Limits for Equity-Exposed Funds | The Philippine Securities and Exchange Commission (SEC) has issued Memorandum Circular No. 2, Series of 2025, relaxing the Single Business Group (SBG) investment limit for equity funds, balanced funds, and multi-asset funds with actual exposure to equity securities. Previously restricted by a 20% cap under SEC MC No. 15 (2020), these funds are now exempt from the SBG limit, provided they do not invest in financial derivatives. Instead, they will be governed by the single entity or issuer investment limits under Rule 6.8(b) of the Investment Company Act’s implementing rules. The SEC also announced a waiver of fines and penalties for past SBG breaches between May 15, 2020, and March 27, 2025. However, funds seeking ASEAN cross-border offerings must continue adhering to the 20% SBG limit in line with regional standards. All other existing investment restrictions remain in force. | |
Singapore | MAS | The Monetary Authority of Singapore (MAS) has issued a revised Compliance Toolkit for Financial Advisers (FAs), effective 1 April 2025, consolidating approval procedures, notifications, and reporting obligations under the Financial Advisers Act (FAA) 2001. This latest version incorporates guidance for licensed and exempt FAs, including those conducting cross-border arrangements. Key updates address the Balanced Scorecard Framework, misconduct reporting under FAA-N14, and structured submissions via MAS-Tx and MASNET platforms. The toolkit also outlines attestation and reporting requirements for handling risks with unlicensed insurers and includes separate procedures for entities serving up to 30 accredited investors. Designed to support consistent regulatory compliance, the toolkit ensures FAs maintain high standards in conduct, governance, and consumer protection. |
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