Report on the actions taken by the addressees to implement the recommendations issued by the NCMO

NCMO recommendation Addressee Actions taken by the addressees
NCMO Recommendation No. 2 of 14 June 2017 on material third countries for the Romanian banking sector in terms of recognising and setting countercyclical buffer rates

(permanent basis)

 

NBR The recommendation was implemented by the NBR carrying out regular assessments, subject to the review and decision of the NCMO General Board, which led to the following being issued : (i) NCMO Decision No. D/8/2018 on identifying material third countries for the Romanian banking sector in terms of recognising and setting countercyclical buffer rates and (ii) NCMO Decision No. D/2/2019 on identifying material third countries for the Romanian banking sector in terms of recognising and setting countercyclical buffer rates. These decisions have shown that for 2018 and 2019 no material third countries were identified for the Romanian banking sector in terms of recognising and setting countercyclical buffer rates.
NCMO Recommendation No. 3 of 14 June 2017 on enhancing statistical information required for the analyses on the real estate market

 

 

NBR, FSA The NBR and the FSA implemented the NCMO recommendation by developing and conducting a questionnaire on real estate and commercial real estate markets in Romania, which was sent to: (1) credit institutions in Romania having an important role in the real estate sector; (2) non-financial corporations participating directly or indirectly in the Romanian real estate market (77 companies); and (3) insurance companies, pension funds and investment funds.

The results of the questionnaire were published in the June 2018 and December 2018 editions of the Financial Stability Report, available on the NBR’s website (https://www.bnr.ro/Regular-publications-2504.aspx).

In light of the difficulties faced by Member States in collecting information, especially data on the commercial real estate market, the European Systemic Risk Board issued the Recommendation of 21 March 2019 amending Recommendation ESRB/2016/14 on closing real estate data gaps (ESRB/2019/3), establishing new deadlines for reporting to the ESRB the availability of indicators (the national macroprudential authorities must send to the ESRB and the Council a final report on applying the recommendations by 31 December 2020).

NCMO Recommendation No. 10 of 18 December 2017 on the impact of credit institutions’ funding plans on the flow of credit to the real economy.

(permanent basis)

NBR The recommendation was implemented via the analyses for 2018 (based on reports having a reference date of 31 December 2017) and for 2019 (based on reports having a reference date of 31 December 2018) on the impact of credit institutions’ funding plans on the flow of credit to the real economy, also in terms of macroprudential policy (the analyses revealed the expected evolution of credit to the real sector and financial intermediation, total debt-to-GDP ratio, the dynamics of the funding and liquidity profile of credit institutions, the impact of funding plans on solvency ratios, etc.).

 

NCMO Recommendation No. R/4/2018 on implementing macroprudential instruments for achieving the intermediate objectives included in the Overall Macroprudential Strategy Framework of the National Committee for Macroprudential Oversight

(permanent basis)

NBR, FSA The NBR conducts regular analyses on the identified risks to and vulnerabilities of the financial system and the real economy, as well as on the appropriateness of implementing/ recalibrating/ deactivating macroprudential instruments. To date, the NBR has implemented the following macroprudential instruments: the capital conservation buffer; the countercyclical capital buffer (CCyB); the other systemically important institutions buffer (O-SII buffer); the systemic risk buffer (SRB); loan-to-value (LTV) requirements; debt service-to-income (DSTI) requirements.

 

The FSA conducts regular analyses on the identified risks to and vulnerabilities of the three non-bank financial markets in its supervisory area, as well as on the appropriateness of implementing the existing macroprudential instruments. To date, the following macroprudential measures have been implemented:

(i) at the level of investment firms (SSIFs): the capital conservation buffer (which was implemented in four annual increments of 0.625 percent of the total risk-weighted exposure from 1 January 2016 to 1 January 2019);

(ii) in the case of insurance companies: the liquidity index of insurance undertakings; the recovery plan;

(iii) in the case of the private pension market: limits on significant exposures;

(iv) in the case of private pension fund administrators: limiting the exposure to an issuer to 5 percent of net assets; the exposure to a group of issuers and their affiliates may not exceed 10 percent of the private pension fund’s assets; and

(v) for all entities under its supervision, the FSA applies requirements on IT system security.

 

NCMO Recommendation No. R/6/2018 on the capital buffer for other systemically important institutions in Romania

 

NBR The NCMO Recommendation was implemented by NBR Order No. 9/2018 on the buffer for credit institutions authorised in Romania and identified as other systemically important institutions (O-SII), which was published in Monitorul Oficial al României, Part I, No. 1110 of 28 December 2018 (effective as of: 28 December 2018).

 

NCMO Recommendation No. R/8/2018 on the countercyclical capital buffer in Romania NBR The NBR implemented the NCMO recommendation by maintaining the countercyclical capital buffer rate at 0 percent, as provided by NBR Order No. 12 of 24 December 2015 on the capital conservation buffer and the countercyclical capital buffer (published in Monitorul Oficial al României, Part I, No. 980 of 30 December 2015). In addition, the NBR closely monitors macroeconomic and financial developments, including in terms of indebtedness at aggregate and sectoral levels.
NCMO Recommendation No. R/1/2019 on the countercyclical capital buffer in Romania NBR The NBR implemented the NCMO recommendation by maintaining the countercyclical capital buffer rate at 0 percent, as provided by NBR Order No. 12 of 24 December 2015 on the capital conservation buffer and the countercyclical capital buffer (published in Monitorul Oficial al României, Part I, No. 980 of 30 December 2015). In addition, the NBR closely monitors macroeconomic and financial developments, including in terms of indebtedness at aggregate and sectoral levels.
NCMO Recommendation No. R/2/2019 on the strategy regarding the implementation of the International Financial Reporting Standards (IFRS) by non-bank financial institutions as a basis of accounting and for preparing individual financial statements NBR The NCMO Recommendation was implemented by NBR Order No. 8/2019 on the application of International Financial Reporting Standards by non-bank financial institutions (published in Monitorul Oficial al României, Part I, No. 908 of 11 November 2019, effective as of 11 November 2019).
NCMO Recommendation No. R/3/2019 on the countercyclical capital buffer in Romania NBR The NBR implemented the NCMO recommendation by maintaining the countercyclical capital buffer rate at 0 percent, as provided by NBR Order No. 12 of 24 December 2015 on the capital conservation buffer and the countercyclical capital buffer (published in Monitorul Oficial al României, Part I, No. 980 of 30 December 2015). In addition, the NBR closely monitors macroeconomic and financial developments, including in terms of indebtedness at aggregate and sectoral levels.
NCMO Recommendation No. R/4/2019 on the capital buffer for other systemically important institutions in Romania NBR The recommendation was implemented by NBR Order No. 10/2019 on the buffer for credit institutions authorised in Romania and identified as other systemically important institutions (O-SIIs), published in Monitorul Oficial al României, Part I, No. 933 of 20 November 2019 (effective as of 20 November 2019).
NCMO Recommendation No. R/5/2019 on the countercyclical capital buffer in Romania NBR The NBR implemented the NCMO recommendation by maintaining the countercyclical capital buffer rate at 0 percent, as provided by NBR Order No. 12 of 24 December 2015 on the capital conservation buffer and the countercyclical capital buffer (published in Monitorul Oficial al României, Part I, No. 980 of 30 December 2015). In addition, the NBR closely monitors macroeconomic and financial developments, including in terms of indebtedness at aggregate and sectoral levels.