How EU supervisors react to interest rate risk outliers
Banks have faced no automatic penalties for breaching new NII test, but do come under microscope
Banks that breach a new regulatory test of interest rate risk in the European Union face differing responses from supervisors, sister title Risk.net has found – even among those subject to the European Central Bank’s single supervisory mechanism.
“I don’t see that each and every bank that surpasses this limit is getting a letter from the ECB,” says Tim Breitenstein, a director of financial services at KPMG.
From October last year, EU supervisors added to their armoury a new test of interest rate
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