The coronavirus pandemic has claimed thousands of lives and put health systems under enormous strain. The Commission’s immediate priority is fighting the virus and mitigating the socio-economic consequences of the pandemic. At the same time, we must start looking ahead so that Member States can gradually lift their containment measures, with a view to entering the recovery phase and revitalising our societies and economy.
While there is no one-size-fits-all approach to a gradual, science-based and effective lifting of containment measures, a highly coordinated way forward is a matter of common European interest.
Responding to the call of the European Council of 26 March, the Commission, in cooperation with the President of the European Council, has put forward a European roadmap towards lifting coronavirus containment measures. It takes into account the expertise of the European Centre for Disease Prevention and Control the Commission’s Advisory Panel on the coronavirus, experience of Member States and guidance from the World Health Organization. Evidently, any such reflection is based on the scientific knowledge available today, and should be revised as further evidence appears.
CONTINUE READING…
Compliments of the European Commission.

May 27, 2020 |
Today, the European Commission has put forward its proposal for a major recovery plan. To ensure the recovery is sustainable, even, inclusive and fair for all Member States, the European Commission is proposing to create a new recovery instrument, Next Generation EU, embedded within a powerful, modern and revamped long-term EU budget. The Commission has also unveiled its adjusted Work Programme for 2020, which will prioritise the actions needed to propel Europe’s recovery and resilience.
The coronavirus has shaken Europe and the world to its core, testing healthcare and welfare systems, our societies and economies and our way of living and working together. To protect lives and livelihoods, repair the Single Market, as well as to build a lasting and prosperous recovery, the European Commission is proposing to harness the full potential of the EU budget. Next Generation EU of €750 billion as well as targeted reinforcements to the long-term EU budget for 2021-2027 will bring the total financial firepower of the EU budget to €1.85 trillion.
European Commission President Ursula von der Leyen said: “The recovery plan turns the immense challenge we face into an opportunity, not only by supporting the recovery but also by investing in our future: the European Green Deal and digitalization will boost jobs and growth, the resilience of our societies and the health of our environment. This is Europe’s moment. Our willingness to act must live up to the challenges we are all facing. With Next Generation EU we are providing an ambitious answer.”
Commissioner Johannes Hahn, in charge of the EU budget, said: “Our common budget is at the heart of Europe’s recovery plan. The additional firepower of Next Generation EU and the reinforced multiannual financial framework will give us the power of solidarity to support Member States and the economy. Together, Europe will arise more competitive, resilient and sovereign.”
Vice-President Maroš Šefčovič, in charge of interinstitutional relations and foresight, said: “The recovery will need strong policy direction. The adapted Work Programme, reflecting the new reality, shows that we will focus all our actions on overcoming the crisis, jumpstarting our economy and putting the European Union firmly on a resilient, sustainable and fair recovery path. It will help us rebound stronger.”
INVESTING FOR THE NEXT GENERATION
Complementing national efforts, the EU budget is uniquely placed to power a fair socio-economic recovery, repair and revitalise the Single Market, to guarantee a level playing field, and support the urgent investments, in particular in the green and digital transitions, which hold the key to Europe’s future prosperity and resilience.
Next Generation EU will raise money by temporarily lifting the own resources ceiling to 2.00% of EU Gross National Income, allowing the Commission to use its strong credit rating to borrow €750 billion on the financial markets. This additional funding will be channelled through EU programmes and repaid over a long period of time throughout future EU budgets – not before 2028 and not after 2058. To help do this in a fair and shared way, the Commission proposes a number of new own resources. In addition, in order to make funds available as soon as possible to respond to the most pressing needs, the Commission proposes to amend the current multiannual financial framework 2014-2020 to make an additional €11.5 billion in funding available already in 2020.
The money raised for Next Generation EU will be invested across three pillars:
1. Support to Member States with investments and reforms:
• A new Recovery and Resilience Facility of €560 billion will offer financial support for investments and reforms, including in relation to the green and digital transitions and the resilience of national economies, linking these to the EU priorities. This facility will be embedded in the European Semester. It will be equipped with a grant facility of up to €310 billion and will be able to make up to €250 billion available in loans. Support will be available to all Member States but concentrated on the most affected and where resilience needs are the greatest.• A €55 billion top-up of the current cohesion policy programmes between now and 2022 under the new REACT-EU initiative to be allocated based on the severity of the socio-economic impacts of the crisis, including the level of youth unemployment and the relative prosperity of Member States. 
• A proposal to strenghten the Just Transition Fund up to €40 billion, toassist Member States in accelerating the transition towards climate neutrality.
• A €15 billion reinforcement for theEuropean Agricultural Fund for Rural Development to support rural areas in making the structural changes necessary in line with the European Green Deal and achieving the ambitious targets in line with the new biodiversity and Farm to Fork strategies.
2. Kick-starting the EU economy by incentivising private investments:
• A new Solvency Support Instrument will mobilise private resources to urgently support viable European companies in the sectors, regions and countries most affected. It can be operational from 2020 and will have a budget of €31 billion, aiming to unlock €300 billion in solvency support for companies from all economic sectors and prepare them for a cleaner, digital and resilient future.• Upgrade InvestEU, Europe’s flagship investment programme, to a level of €15.3 billion to mobilise private investment in projects across the Union.
• A new Strategic Investment Facility built into InvestEU– to generate investments of up to €150 billion in boosting the resilience of strategic sectors, notably those linked to the green and digital transition, and key value chains in the internal market, thanks to a contribution of €15 billion from Next Generation EU.
3. Addressing the lessons of the crisis:
• A new Health Programme, EU4Health, to strengthen health security and prepare for future health crises with a budget of €9.4 billion.• A €2 billion reinforcement of rescEU, the Union’s Civil Protection Mechanism, which will be expanded and strenghetend to equip the Union to prepare for and respond to future crises.
• An amount of EUR€94.4 billion forHorizon Europe, which will be reinforced to fund vital research in health, resilience and the green and digital transitions.
• Supporting Europe’s global partners through an additional €16.5 billion for external action, including humanitarian aid.
• Other EU programmes will be strengthened to align the future financial framework fully with recovery needs and strategic priorities. Other instruments will be reinforced to make the EU budget more flexible and responsive.
Reaching a rapid political agreement on Next Generation EUand the overall EU budget for 2021-2027 at the level of the European Council by July is necessary to give new dynamism to the recovery and equip the EU with a powerful tool to get the economy back on its feet and build for the future.
THE POLICY FUNDAMENTALS OF THE RECOVERY
Relaunching the economy does not mean going back to the status quo before the crisis, but bouncing forward. We must repair the short-term damage from the crisis in a way that also invests in our long-term future. All of the money raised through Next Generation EU will be channelled through EU programmes in the revamped long-term EU budget:
The European Green Deal as the EU’s recovery strategy:
• A massive renovation wave of our buildings and infrastructure and a more circular economy, bringing local jobs;
• Rolling out renewable energy projects, especially wind, solar and kick-starting a clean hydrogen economy in Europe;
• Cleaner transport and logistics, including the installation of one million charging points for electric vehicles and a boost for rail travel and clean mobility in our cities and regions;
• Strengthening the Just Transition Fund to support re-skilling, helping businesses create new economic opportunities.
Strengthening the Single Market and adapting it to the digital age:  
• Investing in more and better connectivity, especially in the rapid deployment of 5G networks;
• A stronger industrial and technological presence in strategic sectors, including artificial intelligence, cybersecurity, supercomputing and cloud;
• Building a real data economy as a motor for innovation and job creation;
• Increased cyber resilience.
A fair and inclusive recovery for all:
• The short-term European Unemployment Reinsurance Scheme (SURE) will provide €100 billion to support workers and businesses;
• A Skills Agenda for Europe and a Digital Education Action Plan will ensure digital skills for all EU citizens;
• Fair minimum wages and binding pay transparency measures will help vulnerable workers, particularly women;
• The European Commission is stepping up the fight against tax evasion and this will help Member States generate revenue.
BUILDING A MORE RESILIENT EU
Europe must enhance its strategic autonomy in a number of specific areas, including in strategic value chains and reinforced screening of foreign direct investment. To increase crisis preparedness and crisis management, the Commission will reinforce the European Medicines Agency and give a stronger role to the European Centre for Disease Control (ECDC) in coordinating medical responses in crises.
The recovery must unequivocally be based on fundamental rights and full respect of the rule of law. Any emergency measures must be limited in time and be strictly proportionate. The Commission’s assessment will be included in the first report under the rule of law mechanism.
We can and must learn the lessons from this crisis, but this can only be done by involving our citizens, communities and cities. The Conference on the Future of Europe will play an important role in further strengthening Europe’s democratic foundations in the post-coronavirus crisis world.
RESPONSIBLE GLOBAL LEADERSHIP
The EU is committed in leading international efforts towards a truly global recovery, notably though joint coordination with the United Nations, the G20 and G7, the International Monetary Fund, the World Bank or the International Labour Organisation. The EU will continue working particularly closely with its immediate neighbourhood in the East and South and its partners in Africa.
BACKGROUND
The Joint Statement of the Members of the European Council adopted on 26 March 2020 called on the European Commission to develop a coordinated exit strategy, a comprehensive recovery plan and unprecedented investment to allow a normal functioning of our societies and economies and get to sustainable growth, integrating inter alia the green transition and the digital transformation. On the basis of this mandate, on 15 April the Presidents of the Commission and the Council presented, as a first step, a Joint European Roadmap towards lifting Covid-19 containment measures. The package presented today, based on a revamped proposal for the next long-term EU budget and the updated Commission Work Programme for 2020, addresses the second part of the mandate, namely the need for a comprehensive recovery plan.
The EU has already delivered a coordinated and powerful collective response to cushion the economic blow of the coronavirus crisis. We have relaxed our fiscal and state aid frameworks to give Member States room to act. We are using every available euro in the EU budget to support the healthcare sector, workers and businesses, and mobilising finance from the markets to help save jobs.
Compliments of the European Commission.

May 26, 2020 |
• Pandemic greatly amplified existing vulnerabilities of the financial sector, corporates and sovereigns
• Policy responses to pandemic essential to preserve financial stability
• Euro area banks, although now better capitalised, likely to face significant losses and further pressure on profitability
Despite the immense social and economic disruption in the wake of the coronavirus (COVID-19) pandemic, decisive policy responses have helped to prevent a seizing-up of the financial system. However, even as infection rates fall in many countries, the impact on the economy and markets has unearthed and increased existing vulnerabilities for euro area financial stability, according to the May 2020 Financial Stability Review (FSR) of the European Central Bank (ECB). Financial stability risks could arise as these vulnerabilities, identified in earlier issues, interact with the pandemic. These include richly valued asset prices, fragile investment funds, the sustainability of sovereign and corporate debt, and weak bank profitability.
“The pandemic has caused one of the sharpest economic contractions in recent history, but wide-ranging policy measures have averted a financial meltdown”, ECB Vice-President Luis de Guindos said. “However, the repercussions of the pandemic on bank profitability prospects and medium-term public finances will need to be addressed so that our financial system can continue to support the economic recovery”, he added.
As the virus spread globally in late February, financial markets saw dramatic falls in asset prices, sharp increases in volatility, illiquidity in some core markets and a general tightening of financial conditions. Some market reactions were amplified by the need for investment funds to sell assets to meet large outflows. Action by central banks globally, notably the ECB’s announcements of large-scale asset purchases (under the public sector purchase programme and the pandemic emergency purchase programme), helped stabilise conditions in markets.
All euro area countries announced fiscal packages to cushion the economic ramifications of the crisis for households and companies. These fiscal measures should support the economic recovery. In particular, they could help the many corporates which are now facing cash-flow strains. Some riskier firms, which had levered up in recent years, are likely to face additional challenges. Looking ahead, the associated increase in public debt levels could also trigger a reassessment of sovereign risk by market participants and reignite pressures on more vulnerable sovereigns.
Although supported by a significant increase in capital and liquidity since the global financial crisis, bank valuations fell to record lows and funding costs increased. This reflected both the deterioration in economic prospects and considerably higher uncertainty about the outlook for euro area banks’ profits and asset quality. Mirroring changes in corporate earnings expectations and weaker income generation on new business, the return on equity for euro area banks in 2020 is now expected to be significantly lower than it was before the pandemic.
Banks should benefit from the action of prudential authorities across the euro area to ease capital requirements and grant banks more operational flexibility to maintain the flow of credit to the economy. In addition, ECB Banking Supervision recommended that banks temporarily refrain from paying dividends or buying back shares, strengthening their capacity to absorb losses and avoid deleveraging. These capital measures are expected to remain in place until the economic recovery is well established.
This issue of the FSR also contains a number of boxes and special features touching on aspects of both recent developments and other important vulnerabilities, including on the potential impact of government loan guarantee schemes (Box 4), bank dividend payout suspensions (Box 5), bank and non-bank interlinkages (Box 6), and the macroeconomic impact of financial policy measures (Box 8).
Compliments of the European Central Bank.

May 26, 2020 |
Main results
Ministers held an exchange of views on a comprehensive approach to the COVID-19 pandemic, including the de-escalation of containment measures and economic recovery.
They were invited to share their experiences and provide comments on how to gradually lift restrictions related to COVID-19 and restart the economy and social activities, taking into account the health considerations.
Ministers outlined their national measures and timelines, stressing the importance of continued cooperation between member states, as well as ensuring a proportionate and non-discriminatory approach when lifting the restrictions and opening the borders.
The European Union must continue with a comprehensive and coordinated approach to the de-escalation of containment measures. We should carefully strike a balance between resuming economic and social activities and protecting the health of our citizens. We should jointly create the conditions for a speedy exit from the crisis and the economic recovery of all member states. – Andreja Metelko-Zgombić, Croatian State Secretary for European Affairs
Ministers also provided their views on a comprehensive economic and social recovery of the EU. They outlined their expectations regarding adjustments to the next multiannual financial framework to take into account the new realities and as regards the planned recovery fund.
A number of key areas of action were mentioned in the discussion, such as strengthening the single market whilst ensuring a level playing field, supporting cohesion and convergence, green transition and digital transformation, and enhancing the EU’s strategic autonomy.
Several speakers pointed out that the Conference on the Future of Europe would be relevant for discussing with EU citizens and other stakeholders the challenges facing the EU in the medium and long term, including the lessons learned from the COVID-19 crisis. The presidency highlighted that its aim is to find an agreement on the Council’s position on the conference as soon as possible and to engage on this basis with the Commission and the European Parliament.
Under ‘any other business’, the Commission informed ministers about the state of play in the preparation of the first annual report on the rule of law in the EU, planned for September. It underlined that the report remains a priority for the Commission and that preparations are well on track despite the difficult circumstances. The aim is to ensure objectivity and an equal treatment of all member states.
Compliments of the European Council.

May 22, 2020 | Statement by HR/VP Josep Borrells
I regret the announcement by the United States to withdraw from the Open Skies Treaty. The Treaty on Open Skies is a key element of our arms-control architecture and serves as a vital confidence and security-building measure.
Since it came into force in 2002, this agreement has enabled to carry out more than 1.500 reconnaissance missions over the territories of all the signatory states.
The treaty provides transparency and predictability. It is an important contribution to European and global security and stability.
All State parties must continue to acknowledge this and ensure the full implementation of the Treaty. Withdrawing from a Treaty is not the solution to address difficulties in its implementation and compliance by another party. While continuing to urge Russia to return immediately to the full implementation of the Treaty, I call upon the United States to reconsider their decision.
The European Union will be examining the implications this decision may have for its own security.
Compliments of the European Union External Action.

Together with our members we are creating a Video series of first-hand accounts of the Pandemic’s impact, both personally & professionally.
We invite you to join us today for a first-hand look at the impact of the global shutdown following the Coronavirus (COVID-19) outbreak – Today we are featuring Celia Belline, CEO, CILcare a EACCNY member.The questions we asked our members for this series are:1) What are some challenges you, personally and your organization have faced?2) What are some of the most surprising (positive, innovative) responses/changes you have witnessed?3) How will this experience change us going forward, as a society and in terms of how we do business?

EACCNY has its finger on the pulse of how this worldwide pandemic is effecting companies and organizations on both sides of the Atlantic. EACC is where Americans & Europeans connect to do business.
Stay tuned for more on this series! We hope you enjoy these short vignettes our members and friends of the EACC created to share their experience.

May 20, 2020 |
The EU is adapting certain rules for different transport sectors to help companies and authorities cope in the extraordinary circumstances created by the coronavirus crisis. Today, the Council adopted temporary measures enabling the extension of the validity of certain certificates and licences in road, rail and waterborne transport, and relaxing the rules on charging ships for the use of port infrastructures.
Enabling the extension of the validity of licences and certificates will provide the flexibility and legal certainty needed to maintain our supply chains and ensure continued mobility by road, rail, sea and inland waterways, while safeguarding safety and security. The possibility of waiving port infrastructure charges will help mitigate the serious negative impact of the crisis on the shipping sector. – Oleg Butković, Croatian Minister for the Sea, Transport and Infrastructure, President of the Council
The regulation enabling the extension of the validity of certificates and licences will support those transport operators, individuals and national administrations that, owing to the coronavirus restrictions, are having difficulties fulfilling certain administrative formalities before the expiry of the relevant deadlines. This applies for instance to driving licences, roadworthiness tests for motor vehicles and boat-masters’ certificates.
Certain periodic checks in the road, rail, inland navigation and shipping sectors will also be postponed temporarily, as they may not be feasible in current circumstances.
The text takes into account the fact that, given the differences in the spread of the pandemic throughout Europe, some member states are able to continue to deliver specific licences or certificates, while others find it difficult or impossible to do so. However, even if a country continues to issue licences itself, it will need to accept licences originating in another member state which has used the possibility of extending their validity. This will help ensure the smooth functioning of the internal market and continued cross-border activities.
The amendment to the port services regulation will contribute to the financial sustainability of ship operators in the context of the pandemic by providing flexibility to the existing rule that requires member states to ensure that a port infrastructure charge is levied. The amendment will give ports the possibility to waive, suspend, reduce or defer the charges for port users due between 1 March 2020 and 31 October 2020.
The Council’s vote on the two regulations was taken using a written procedure, which was concluded today. The European Parliament voted on 15 May 2020.
Both legal acts will enter into force the day after they are published in the EU Official Journal, which is expected to take place next week.
The legislative process is still ongoing for the other two proposals in the transport emergency package presented by the Commission on 29 April 2020, which concern aviation and the fourth railway package.
• Regulation laying down specific and temporary measures in view of COVID-19 outbreak and concerning the validity of certain certificates, licences and authorisations and the postponement of certain periodic checks and training in certain areas of transport legislation – full text
• Regulation amending regulation 2017/352, so as to enable managing bodies or competent authorities to provide flexibility in respect of the levying of port infrastructure charges in the context of the COVID-19 outbreak – full text
• COVID-19 coronavirus outbreak and the EU’s response (background information)
• Travel and transportation during the coronavirus pandemic
Compliments of the European Council.

May 22, 2020 |
External communication
Communication in relation to the German Federal Constitutional Court ruling of 5 May 2020
On 5 May 2020 the ECB issued a press release indicating that the Governing Council had taken note of the judgement issued by the German Federal Constitutional Court earlier that day regarding the public sector purchase programme (PSPP), on which it had received a preliminary briefing by the President of the Deutsche Bundesbank and by the legal department of the ECB, and remained fully committed to doing everything necessary within its mandate to meet the ECB’s statutory objective of maintaining price stability.
Market operations
Guideline amending Guideline ECB/2014/31 on additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral
On 7 May 2020 the Governing Council adopted Guideline ECB/2020/29 amending Guideline ECB/2014/31 on additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral. This amending guideline implements the collateral easing measures decided by the Governing Council on 22 April 2020 in response to the coronavirus (COVID-19) pandemic. The guideline is available on the ECB’s website.
Ad hoc assessment of two new non-regulated markets
On 14 May 2020 the Governing Council decided to add the non-regulated Alternative Fixed-Income Market in Spain and the First North Market in Lithuania to the list of accepted non-regulated markets for assets eligible as collateral for Eurosystem monetary policy operations, following a positive assessment of their compliance with the criteria defined in the General Documentation. The complete list of accepted non-regulated markets is available on the ECB’s website.
Expansion of additional credit claim frameworks in response to the COVID-19 pandemic
On 15 May 2020 the Governing Council approved changes to the temporary additional credit claim (ACC) frameworks of six national central banks (NCBs), upon request of the respective NCBs. The proposed extensions primarily cover the acceptance of one new ACC framework and ACCs benefiting from the new guarantee schemes adopted in a number of jurisdictions in response to the COVID-19 pandemic, together with specific risk control frameworks to address deviations from the requirements applicable to guarantees under the General Documentation, as well as further changes that widen the scope of accepted assets and in-house credit assessment systems for some of the six NCBs. The ACC frameworks were introduced in 2011 to allow Eurosystem NCBs to temporarily accept as collateral certain credit claims that are not compliant with the eligibility rules and/or credit quality standards established in the General Documentation. The collateral easing package adopted by the Governing Council on 7 April 2020 introduced the possibility of expanding these frameworks further. The acceptance of these ACC frameworks is subject to prior approval by the Governing Council. More detailed information on the ACC frameworks is available on the ECB’s website.
Financial stability and supervision
Financial Stability Review May 2020
On 20 May 2020 the Governing Council authorised the publication of the “Financial Stability Review – May 2020”. This issue assesses how the financial system has functioned so far during the COVID-19 pandemic and considers the financial stability implications of its potential economic after-effects, taking into account the financial vulnerabilities identified before the pandemic, including those related to the functioning of financial markets, debt sustainability, bank profitability and the non-bank financial sector. The Review also sets out policy considerations for both the near term and the medium term with a view to promoting awareness of systemic risks among policymakers, the financial industry and the public at large. This issue also contains two special feature articles. The first is dedicated to trends in residential real estate lending standards and their implications for financial stability, and the second examines derivatives-related liquidity risk facing investment funds. The Review will be published on the ECB’s website on 26 May 2020.
Market infrastructure and payments
Identification of a new systemically important payment system
On 4 May 2020 the Governing Council adopted Decision ECB/2020/26 on the identification of MASTERCARD CLEARING MANAGEMENT SYSTEM as a systemically important payment system pursuant to Regulation (EU) No 795/2014 on oversight requirements for systemically important payment systems. This identification is the outcome of an exercise to verify that the operator fulfils a number of objective criteria that are set out in the Decision, which is available on the ECB’s website.
TARGET Annual Report 2019
On 14 May 2020 the Governing Council took note of the TARGET Annual Report 2019, which was subsequently published on the ECB’s website. The report provides information on TARGET2 traffic, its performance and the main developments in 2019. It also includes seven boxes which provide detailed information on topics of particular relevance in 2019, namely the evolution of traffic in TARGET2, a survey on TARGET2 activity, liquidity distribution in TARGET2, the treatment of a participant in resolution, end point security, detection of fraudulent payments and a status update on the TARGET2/T2S consolidation project and future real-time gross settlement services.
Advice on legislation
ECB Opinion on a proposal for a regulation on the establishment of a European instrument for temporary support to mitigate unemployment risks in an emergency (SURE) following the COVID-19 outbreak
On 8 May 2020 the Governing Council adopted Opinion CON/2020/14 on its own initiative.
ECB Opinion on amendments to Latvian national security, emergency situation and mobilisation laws
On 11 May 2020 the Governing Council adopted Opinion CON/2020/15 at the request of the Ministry of Finance of the Republic of Latvia.
ECB Opinion on amendments to the Union prudential framework in response to the COVID-19 pandemic
On 20 May 2020 the Governing Council adopted Opinion CON/2020/16 at the request of the Council of the European Union.
Corporate governance
Schedules for the meetings of the Governing Council and the General Council of the ECB in 2021
On 29 April 2020 the Governing Council approved its meeting schedule for 2021. The General Council also approved its meeting schedule for that year. The schedules are available on the ECB’s website.
Appointment of two members of the Market Infrastructure Board
On 4 May 2020 the Governing Council appointed Mr Giandomenico Scarpelli, Head of the Payment Systems Directorate at the Banca d’Italia, as a Eurosystem national central bank (NCB) member of the Market Infrastructure Board and Ms Christina Wejshammar, Head of the Payments Department at Sveriges Riksbank, as a non-Eurosystem NCB member of the Board. These appointments were made with immediate effect until 31 May 2022 so as to coincide with the mandates of the other Board members who had been appointed or reappointed for 36 months from 1 June 2019.
Joint Eurosystem procurement legal framework
On 4 May 2020 the Governing Council took note of the 2019 annual report of the Eurosystem Procurement Coordination Office (EPCO) and approved the 2020 update of the EPCO procurement plan. On the same day, the Governing Council also adopted Decision ECB/2020/27 amending Decision ECB/2008/17 laying down the framework for joint Eurosystem procurement. The amending legal act, which takes stock of the positive experience with joint procurement of goods and services and the permanent nature of EPCO as decided by the Governing Council on 26 April 2019, caters for enlarged participation possibilities and more operational flexibility in the daily operations. The decision is available on the ECB’s website.
International and European cooperation
19th annual review of the international role of the euro
On 14 May 2020 the Governing Council approved the 19th annual review of the international role of the euro and authorised its publication. In line with the biennial cycle for publication of this report series decided on in 2016, this year’s release is an interim version without special features. It does, however, contain one analytical box on the role of the euro in global green bond markets. The report presents a concise overview of developments in the use of the euro by non-euro area residents and provides updated statistical information on the main indicators of the euro’s international status considered to be of interest to the general public. The report is scheduled to be published on the ECB’s website on 15 June 2020.
Banking supervision
Compliance with EBA Guidelines on harmonised definitions and templates for funding plans
On 30 April 2020 the Governing Council did not object to a proposal by the Supervisory Board to notify the European Banking Authority (EBA) that, for the significant institutions under its direct supervision, the ECB will comply with the EBA Guidelines on harmonised definitions and templates for funding plans of credit institutions under Recommendation A4 of ESRB/2012/2 (EBA/GL/2019/05) from 31 December 2020, the date on which they become applicable. The Guidelines enhance the granularity of the reported data points and thereby increase comparability, allowing for a more thorough assessment of banks’ funding plans.
Revised Supervisory Review and Evaluation Process in 2020
On 12 May 2020 the Governing Council did not object to a proposal by the Supervisory Board to approve a revised Supervisory Review and Evaluation Process (SREP) timeline and approach in 2020, taking into account the impact of the COVID-19 pandemic on both human resources and other general resources. Accordingly, there will be a pragmatic approach to the SREP for the 2020 cycle, focusing on banks’ ability to handle the challenges of the COVID-19 crisis. The significant institutions under the ECB’s direct supervision were subsequently informed.
Compliance with EBA Guidelines on ICT and security risk management
On 13 May 2020 the Governing Council did not object to a proposal by the Supervisory Board to notify the EBA that, for the significant institutions under its direct supervision, the ECB will comply with the EBA Guidelines on ICT and security risk management (EBA/GL/2019/04) from 30 June 2020. The Guidelines contribute to a level playing field for all financial institutions and respond to the European Commission’s request to develop guidelines on ICT risk management and mitigation requirements in the EU financial sector.
Compliments of the ECB.

Together with our members we are creating a Video series of first-hand accounts of the Pandemic’s impact, both personally & professionally.

We invite you to join us today for a first-hand look at the impact of the global shutdown following the Coronavirus (COVID-19) outbreak – Today we are featuring Phil Hogan, the Trade Commissioner for the European Union based in Brussels.
The questions we asked our members for this series are:1) What are some challenges you, personally and your organization have faced?2) What are some of the most surprising (positive, innovative) responses/changes you have witnessed?3) How will this experience change us going forward, as a society and in terms of how we do business?

EACCNY has its finger on the pulse of how this worldwide pandemic is effecting companies and organizations on both sides of the Atlantic. EACC is where Americans & Europeans connect to do business.
Stay tuned for more on this series! We hope you enjoy these short vignettes our members and friends of the EACC created to share their experience.
 

May 19, 2020 |
• Credit terms remained broadly unchanged for almost all counterparties but are expected to tighten significantly the next reference period
• Financing collateralised by euro-denominated securities continued to decline
• Valuation disputes saw a strong increase
• Terms and conditions in secured financing and OTC derivatives markets were, on balance, broadly unchanged compared with one year ago
Against the background of the emerging coronavirus (COVID-19) crisis during the latter part of the review period December 2019 to February 2020, price and non-price credit terms offered to non-financial corporations, insurance companies and hedge funds tightened somewhat in both the securities financing market and the OTC derivatives market. Terms and conditions for banks and sovereign counterparties remained almost unchanged or eased somewhat on account of improving liquidity conditions. However, survey respondents expect credit terms and conditions to tighten significantly for all counterparty types over the next three months, in particular for banks and dealers. Respondents also reported a material increase in the volume of valuation disputes with banks and dealers.
The maximum amount and maturity of funding offered against euro-denominated securities continued to decline, especially for funding secured with high-quality government, corporate and covered bonds and, to a lesser extent, asset-backed securities. Haircuts increased for most collateral types. However, financing rates/spreads decreased somewhat for funding secured by all types of collateral except equities, convertible securities and high-yield corporate bonds. Respondents reported the strongest increase in collateral valuation disputes over a three-month reference period – for all collateral types except domestic government bonds – since the launch of the survey in 2013.
For all types of non-centrally cleared OTC derivatives, initial margin requirements increased, liquidity and trading deteriorated materially, and valuation disputes rose.
As a result of the developing coronavirus (COVID-19) crisis, many respondents submitted their survey responses for the period December 2019 to February 2020 after the 5 March 2020 deadline. These respondents finalised their feedback against the background of the rapidly evolving crisis. It cannot be excluded that these respondents took these developments into account in their submissions.
As in previous years, the March 2020 survey also included a number of special questions designed to offer a longer-term perspective on credit standards by comparing current conditions with those observed one year ago. Respondents reported that, on balance, terms and conditions in the secured financing and OTC derivatives markets remained broadly unchanged from the previous year, having tightened slightly for hedge funds and investment funds while easing for sovereigns, banks and dealers. In net terms, credit standards for secured funding eased relative to a year ago, while non-price conditions in OTC derivatives markets eased somewhat for most types of derivatives over the same period.
The SESFOD survey is conducted four times a year and covers changes in credit terms and conditions over three-month reference periods ending in February, May, August and November. The March 2020 survey collected qualitative information on changes between December 2019 and February 2020. The results are based on responses from a panel of 28 large banks, comprising 14 euro area banks and 14 banks with head offices outside the euro area.
Compliments of the European Central Bank.