EUROPE: ESMA Publishes Compliance Table on Revised Guidelines on stress tests scenarios under Article 28 of the MMF Regulation

Monday October 25 2021

ESMA has published the compliance table on the guidelines on ESMA’s Guidelines on stress test scenarios under the MMF Regulation.

The majority of jurisdictions “comply” or “intend to comply”.

However, HCMC does not intend to comply with the Guidelines on MMF stress tests because, in the view of the HCMC, certain sections of the Guidelines, including certain scenarios referred to in section 5 of the Guidelines rely solely on external credit ratings while external credit ratings should only be a complement to the MMF internal credit quality assessment referred to in article 19 of the MMFR. In addition, the HCMC would like to emphasize that for the assets referred to in article 10(3) of the MMF R (those money market instruments issued or guaranteed by the Union, or by certain public central authorities or central banks), a favorable assessment is not required pursuant to the internal credit quality assessment procedure laid down in articles 19 to 22, and therefore in that specific case, external credit ratings are not required.

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