DOCSLIB.ORG

Final Mifir Review Report

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Final Mifir Review Report Final Report MiFIR review report on the obligations to report transactions and reference data 23 March 2021 | ESMA74-362-1013 ESMA REGULAR USE Table of Contents 1 Legislative references and abbreviations .......................................................................... 6 2 Executive Summary .......................................................................................................... 9 3 Introduction ..................................................................................................................... 11 3.1 Scope of the Report ................................................................................................. 11 3.2 General feedback to the Consultation ...................................................................... 12 4 Entities subject to transaction reporting and arrangements for sharing reports (Article 26(1), Article 26(5) and Article 26(8) MiFIR) .......................................................................... 17 4.1 AIFMD and UCITS firms .......................................................................................... 17 4.1.1 Legal framework ............................................................................................... 17 4.1.2 ESMA’s proposal in the CP .............................................................................. 18 4.1.3 Feedback to the consultation ............................................................................ 19 4.1.4 ESMA’s assessment and recommendations .................................................... 19 4.2 Reference to ‘members/participants/users’ of Trading Venues ............................... 20 4.2.1 Legal framework ............................................................................................... 20 4.2.2 ESMA’s proposal in the CP .............................................................................. 21 4.2.3 Feedback to the consultation ............................................................................ 22 4.2.4 ESMA’s assessment and recommendations .................................................... 22 4.3 Branches of EEA Entities ......................................................................................... 23 4.3.1 Legal framework ............................................................................................... 23 4.3.2 ESMA’s proposal in the CP .............................................................................. 23 4.3.3 Feedback to the consultation ............................................................................ 24 4.3.4 ESMA’s assessment and recommendations .................................................... 24 4.4 Arrangements for sharing reports ............................................................................ 24 4.4.1 Legal framework ............................................................................................... 24 4.4.2 ESMA’s proposal in the CP .............................................................................. 25 4.4.3 Feedback to the consultation ............................................................................ 25 4.4.4 ESMA’s assessment and recommendations .................................................... 25 5 Scope of instruments subject to reporting obligations (Articles 26(2) and 27(1)) ............ 26 5.1.1 Legal framework ............................................................................................... 26 5.2 Concept of Traded on a Trading Venue (ToTV) ...................................................... 27 5.2.1 Legal framework ............................................................................................... 27 5.2.2 ESMA’s proposal in the CP .............................................................................. 29 1 ESMA REGULAR USE 5.2.3 Feedback to the consultation ............................................................................ 31 5.2.4 ESMA’s assessment and recommendations .................................................... 32 5.3 Transaction reporting indices under Article 26(2)(c) ................................................ 35 5.3.1 Legal framework ............................................................................................... 35 5.3.2 ESMA’s proposal in the CP .............................................................................. 36 5.3.3 Feedback to the consultation ............................................................................ 37 5.3.4 ESMA’s assessment and recommendations .................................................... 38 5.4 Scope of reference data: merging Article 4 of MAR into Article 27 of MiFIR ........... 40 5.4.1 Instrument listed on a MTF ............................................................................... 40 5.4.1.1 Legal framework ............................................................................................ 40 5.4.1.2 ESMA’s proposal in the CP ........................................................................... 41 5.4.1.3 Feedback to the consultation ........................................................................ 41 5.4.1.4 ESMA’s assessment and recommendations ................................................. 41 5.4.2 Approval of trading on an MTF or OTF ............................................................. 42 5.4.2.1 General approach and legal framework ........................................................ 42 5.4.2.2 ESMA’s proposal in the CP ........................................................................... 42 5.4.2.3 Feedback to the consultation ........................................................................ 42 5.4.2.4 ESMA’s assessment and recommendations ................................................. 42 5.4.3 Request for admission to trading ...................................................................... 43 5.4.3.1 Legal framework ............................................................................................ 43 5.4.3.2 ESMA’s proposal in the CP ........................................................................... 43 5.4.3.3 Feedback to the consultation ........................................................................ 44 5.4.3.4 ESMA’s assessment and recommendations ................................................. 44 5.4.4 Frequency of updates to instrument reference data (defined list) .................... 44 5.4.4.1 Legal framework ............................................................................................ 44 5.4.4.2 ESMA’s proposal in the CP ........................................................................... 45 5.4.4.3 Feedback to the consultation ........................................................................ 46 5.4.4.4 ESMA’s assessment and recommendations ................................................. 46 5.4.5 Reference to Articles on transparency requirements ........................................ 47 5.4.5.1 Legal framework ............................................................................................ 47 5.4.5.2 ESMA’s proposal in the CP ........................................................................... 47 5.4.5.3 Feedback to the consultation ........................................................................ 47 5.4.5.4 ESMA’s assessment and recommendations ................................................. 47 5.4.6 Deletion of Article 4 MAR .................................................................................. 48 5.4.6.1 ESMA’s proposal in the CP ........................................................................... 48 2 ESMA REGULAR USE 5.4.6.2 Feedback to the consultation ........................................................................ 48 5.4.6.3 ESMA’s assessment and recommendations ................................................. 48 6 Details to be reported (Article 26(3)): Trading Venue Transaction Identification; chain of transactions. ........................................................................................................................... 49 6.1 Legal framework ...................................................................................................... 49 6.2 ESMA’s proposal in the CP ...................................................................................... 49 6.3 Feedback to the consultation ................................................................................... 50 6.4 ESMA’s assessment and recommendations ........................................................... 51 7 Details to be reported: the identifiers to be used for parties (Articles 26(3) and 26(6)). .. 52 7.1 Legal Framework ..................................................................................................... 52 7.2 ESMA’s proposal in the CP ...................................................................................... 53 7.3 Feedback to the consultation ................................................................................... 54 7.4 ESMA’s assessment and recommendations ........................................................... 54 8 Details to be reported (Article 26(3)): a designation to identify the computer algorithms and a short sale; ............................................................................................................................ 55 8.1 Algo ID ..................................................................................................................... 55 8.1.1 Legal framework ..............................................................................................
Load more

Recommended publications
  • MCED Access to Finance Briefing
    Access to Finance and Community Economic Development Solutions Pat Conaty Localise West Midlands – Community Economic Development Project Discussion Paper October 2012 The double-dip recession in the UK has highlighted the access to finance issue. John Stuart Mill observed in 1844 that business slumps are characterised by credit rationing problems by banks and that stimulating new investment is crucial. i The credit crunch problem is currently deep and apparently structural. Diverse methods by the Coalition government over the past year have thus far failed to turn the problem round. Bank lending to all businesses according to Bank of England data has declined by 17% over the past four years and collapsed by £4 billion in the three months to May 2012. ii This paper examines the access to finance issue both in relation to the current crisis but also more broadly in relation to enterprises and organisations that even in good times find it very hard to secure investment from the banks. This is particularly a major issue in the UK because of the intensive centralisation and concentration of banking. The paper also looks at a broader range of solutions that have been developed by community economic development methodologies, the co-operative sector and by government intervention. Finally the policy context will be examined and ways proposed for developing a new more socially and financially inclusive approach to local economic development. 1. Bankability and access to finance – the barriers in the UK Banking and high street lending has changed beyond recognition since the regulatory changes introduced in the 1980s in the lead up to the Big Bang.
    [Show full text]
  • Banker" Redirects Here
    Bank From Wikipedia, the free encyclopedia Jump to: navigation, search For other uses, see Bank (disambiguation). "Banker" redirects here. For other uses, see Banker (disambiguation). "Bankers" redirects here. For the economics book, see The Bankers. This article has multiple issues. Please help improve it or discuss these issues on the talk page. • It needs additional references or sources for verification.Tagged since July 2008. • It may require general cleanup to meet Wikipedia's quality standards. Tagged since June 2010. Banking Types of banks Central bank Advising bank Commercial bank Community development bank Credit union Custodian bank Depository bank Export credit agency German public bank Investment bank Industrial bank Islamic banking Merchant bank Mutual bank Mutual savings bank National bank Offshore bank Private bank Savings and loan association Savings bank Swiss bank Universal bank Deposit accounts Savings account Transactional account Money market account Time deposit ATM card Debit card Credit card Electronic funds transfer Automated Clearing House Electronic bill payment Giro Wire transfer Banking terms Anonymous banking Automatic teller machine Loan Money creation Substitute check List of banks Finance series Financial market Financial market participants Corporate finance Personal finance Public finance Banks and Banking Financial regulation v·d·e Finance Financial markets [show] Bond market Stock market (equity market) Foreign exchange market Derivatives market Commodity market Money market Spot market (cash market)
    [Show full text]
  • 1 Od Redakcji 1
    BANK I KREDYT wrzesieƒ 2001 Od Redakcji 1 prof. nadzw. dr hab. Stanis∏aw Flejterski Zaproszenie do napisania tego wst´pnego eseju dotar∏o do mnie podczas sierpniowego pobytu naukowego w Instytucie BankowoÊci i Finansów Wolnego Uniwersytetu w Berlinie. Dla akademickiego finansisty, by∏ego wieloletniego mened˝era bankowego, taka kilkutygodniowa podró˝ to Êwietna okazja do zapoznania si´ z setkami najnowszych publikacji anglo- i niemieckoj´zycznych z dziedziny szeroko rozumianych finansów, a tak˝e do rozmów z tamtejszymi uczonymi, z dyrektorem Instytutu prof. Lutzem Kruschwitz'em na czele. OczywiÊcie, rozmawialiÊmy o finansach: zarówno o realnych zjawiskach i procesach finansowych w Niemczech, w Polsce i w USA, jak i o tendencjach w nauce finansów, a ÊciÊlej w naukach finansowych. Niektórzy nieprzypadkowo twierdzà, ˝e finanse sà wspó∏czeÊnie najwa˝niejsze, najciekawsze i najtrudniejsze. Finanse globalne i miedzynarodowe, finanse publiczne - zarówno te „rzàdowe”, jak i samorzàdowe (regionalne i lokalne) - finanse rynków finansowych, z kapita∏owym na czele, finanse banków (banku centralnego, banków komercyjnych, uniwersalnych i wyspecjalizowanych, banków spó∏dzielczych, banków inwestycyjnych), finanse ubezpieczeƒ spo∏ecznych i gospodarczych, finanse przedsi´biorstw (zarówno corporate finance, jak i finanse ma∏ych i Êrednich przedsi´biorstw, w wydaniu niemieckim tzw. Mittelstand), finanse organizacji i instytucji typu non-profit (np. koÊcio∏ów, partii politycznych etc.), wreszcie - last but not least - finanse gospodarstw domowych. Zadaniem wymienionych subdyscypiln finansowych jest opisywanie i objaÊnianie natury zjawisk finansowych, a ponadto formu∏owanie twierdzeƒ, „jak byç powinno” i „co robiç, aby by∏o tak, jak byç powinno”. Finanse sà w gruncie rzeczy dyscyplinà przed wszystkim utylitarnà, zorientowanà na udzielanie praktycznych odpowiedzi politykom, mened˝erom, inwestorom etc.
    [Show full text]
  • French Fintech Ecosystem
    About Exton Consulting Exton Consulting is a strategy and management consulting firm, founded in 2006 and specializing in financial services: insurance, retail banking, cards and payments, CIB & Asset Management. As a key player in this field, Exton Consulting provides executive boards with the advice and support needed to manage company growth, transformation and innovation. The firm is represented in France, Italy, Germany and Morocco and employs 150 consultants with a high level of expertise and competence. With more than 10 years of experience, Exton Consulting has become a privileged partner in addressing the challenges and opportunities of digital transformation in financial services. In direct contact with the FinTech and entrepreneurial ecosystem, to better support its clients in their innovation projects, Exton Consulting is a founding member of Le Swave, the first French acceleration platform for FinTechs, and a partner of Finance Innovation, an active member of its FinTechs banking and insurance projects labelling committee. For more information: www.extonconsulting.com [email protected] FOREWORD Some observers predicted that the FinTech phenomenon would slow down worldwide at competitive advantages and accelerate their digital transformation. the end of 2016. However, financial start-ups continue to attract investors and 2018 is already proving to be a record year. These are just some of the factors that lead to attractive development opportunities for FinTechs in France. Europe is the region with the strongest growth in 2017 (+121%) and in third place after North America and Asia in terms of invested amounts. The continent has a regulatory In this context, Exton Consulting and the Finance Innovation cluster wanted to framework that favours the emergence of FinTechs (with the European financial passport combine their expertise in order to: and the entry into force of PSD2, which paves the way for open banking).
    [Show full text]
  • From Bigtechs and Fintechs to Smartphones and Stablecoins Roundtable on Digitalisation German Institute for Japanese Studies
    Curtain up for the future of payments: from Bigtechs and Fintechs to Smartphones and Stablecoins Roundtable on Digitalisation German Institute for Japanese Studies 30.10.2019 | German Institute for Japanese Studies in Tokyo | Burkhard Balz Introduction FinTechs and BigTechs: new actors in the payments markets Smartphones: changes in user and payment behaviour Stablecoins: the challenge of Libra Possible answers and conclusions Introduction Ladies and gentlemen, Professor Waldenberger, [1] Thank you very much for inviting me here to the German Institute for Japanese Studies in Tokyo. I have to admit that, compared with the metropolis of Tokyo, my place of work – Frankfurt – feels like a village, to say nothing of my hometown of Stadthagen west of Hanover in charming Lower Saxony. Tokyo and Frankfurt, or rather Japan and Germany, are some 10,000 km – a 12-hour flight – apart, and they each have their own distinct culture with many special features. At the same time, our two countries share multiple ties and have a high degree of mutual appreciation. I also have the impression that the Japanese and Germans are not that dissimilar in many respects: 1) The Japanese are known for being very thorough and passionate about order, making them very similar to the Germans or even putting them one step ahead of us. 2) Many Japanese love beer. Just like we do … 3) And the Japanese have an affinity for cash – the same is not just said about the Germans, our payment behaviour studies provide research-based evidence of this. And yet, payment behaviour is being transformed by digitalisation, which brings me straight to the subject of my speech.
    [Show full text]
  • Overview of Apis and Bank-As- A-Service in FINTECH Baas for Banks As Amazone Web Services for E-Commerce
    Overview of APIs and Bank-as- a-Service in FINTECH BaaS for banks as Amazone Web Services for e-commerce Traditional bank 2015 customers 67% product Amazon’s profit New fintech comes from AWS! players marketing support ? human resources To fight with - complience IT-guys to support - processing center and manage servers or to earn with - card issuing 2006 - money storage Creation of AWS for new players License Servers You may write off infrastructure investments or use them as new revenue streams While banks have always been looking to con- ratization.¹ Fintech-startups nowadays can serve trol the financial services industry, with the rise of almost any financial need for the eligible popu- fintech, the situation has changed drastically. One lation. Now banks are looking to collaborate with of the core differences in approach to financial fintech so as to not to lose the links in the value services between banks and fintech lies in democ- chains that make them so powerful. Chris Skinner one of the TOP5 fintech-influencers and predictors, author of bestsellers «DIGITAL BANK and «VALUE WEB», managing partner of the BB Fund in London You’re probably all familiar with SaaS – it’s basically paying for applications as you use them, rather than buying them. These services used to cost you a fortune, but are now free or near enough. That’s where banking is going. Banking becomes plug and play apps you stitch together to suit your business or lifestyle. There’s no logical reason why Banking shouldn’t be delivered as SaaS. This is the future bank, and old banks will need to reconsider their services to com- pete with this zero margin model.
    [Show full text]
  • German Banking Returns to the Playing Field
    Perspective German banking returns to the playing field July 2021 © Getty Images The next game is always the hardest. —Sepp Herberger, coach of the 1954 world champion German soccer team Contents Introduction: Preseason analysis 4 1. German banking today: Heading toward relegation? 7 Banks are reliable on the fundamentals 7 High stability 7 Meeting financial needs 7 Relatively low prices 7 A tough business environment demands more of banks 9 Overbanked and fragmented market 10 Declining revenue pool 10 Falling market share 10 Low efficiency 11 Low profitability 12 A tarnished public image? 13 Declining economic contribution 13 Decreasing market capitalization 13 Declining appeal for new talent 14 2. Time for a new campaign 17 Recognize the profit challenge and raise ambitions 17 Breaking the 0 percent ROE trend 17 Raising ambitions lead to sustainable business growth 17 Choose a revenue and cost pathway toward 7–8 percent ROE 19 Prepare for additional challenges and set holistic priorities 22 Customer at the center—always and everywhere 22 The ESG challenge 24 Set top priorities 26 2 German banking returns to the playing field 3. A winning game plan for 2030 29 Craft a more responsive business strategy 30 Enhance tech-enabled customer engagement 31 Breathe customer centricity 31 Unlock data and analytics 32 Live smart-channel distribution 33 Engage in new-business building 35 Embrace innovation and digital business building 35 Agree on a new deal with customers 36 Follow clients abroad 36 Build a truly digital operating model 37 Digitize for productivity 37 Consolidate and cooperate to build scale 38 Optimize for capital usage 39 Restructure and refurbish culture 39 Include ESG in banking’s purpose 40 The next season 45 Notes 46 Authors and contacts 51 German banking returns to the playing field 3 Introduction: Preseason analysis If trends continue and German banks take no action, ROEs could fall to 0 percent by 2030.
    [Show full text]
  • The Role of Patient Finance in Mission-Oriented Innovation: the Market Shaping Role of State Investment Banks
    INNOVATION-FUELLED, SUSTAINABLE, INCLUSIVE GROWTH Working Paper The role of patient finance in mission-oriented innovation: the market shaping role of state investment banks Mariana Mazzucato Institute for Innovation and Public Purpose, University College London Laurie Macfarlane Institute for Innovation and Public Purpose, University College London Caetano Penna Science Policy Research Unit, University of Sussex and Institute of Economics, Federal University of Rio de Janeiro, Brazil Josh Ryan-Collins Institute for Innovation and Public Purpose, University College London 21/2018 May This project has received funding from the European Union Horizon 2020 Research and Innovation action under grant agreement No 649186 The role of patient finance in mission-oriented innovation: the market shaping role of state investment banks Mariana Mazzucato*, Laurie Macfarlane*, Caetano Penna† and Josh Ryan-Collins* Abstract To achieve innovation and investment-led growth, the EU requires patient, long-term committed finance. This report, which incorporates two previously published papers supported by the ISIGrowth project, examines the role of state investment banks (SIBs) in providing patient finance. We first review how the mainstream “market failure theory” justifies the existence of SIBs. We then propose an alternative conceptualisation drawing upon insights from heterodox economic theory that argues SIBs can help deliver mission- oriented innovation policies via their market shaping and market creating role. We then present an analysis of eight different SIBs, including six in Europe, examining their mission and vision, economic role, investment activities, management of risk and reward and their links to government policy. The paper concludes by drawing out lessons for the way in which the EU could increase patient finance by expanding the role of the European Investment Bank and member state investment banks.
    [Show full text]
  • German Banks in the Global Economy: Global Pressures and Public Sector Banking Jason A
    Claremont Colleges Scholarship @ Claremont Pitzer Senior Theses Pitzer Student Scholarship 2008 German Banks in the Global Economy: Global Pressures and Public Sector Banking Jason A. Gorn Pitzer College Recommended Citation Gorn, Jason A., "German Banks in the Global Economy: Global Pressures and Public Sector Banking" (2008). Pitzer Senior Theses. Paper 9. http://scholarship.claremont.edu/pitzer_theses/9 This Open Access Senior Thesis is brought to you for free and open access by the Pitzer Student Scholarship at Scholarship @ Claremont. It has been accepted for inclusion in Pitzer Senior Theses by an authorized administrator of Scholarship @ Claremont. For more information, please contact [email protected]. German Banks in the Global Economy: Global Pressures and Public Sector Banking Jason A. Gorn German banking is distinguished from neighboring European banking systems by the influence of its public sector banks. Nearly 50% of German banking is carried out by government owned state banks (ländesbanken) and regional savings banks (sparkassen) whose roots date from the 18 th century. German banks play a particularly important role in the economy and exert more control over firms and corporations than do their American counterparts. German banks tend to be less profitable than foreign counterparts. German public banks were originally founded to foster local and regional business. However, the operations of German public sector banks now extend into all forms of international investment. German public banks are currently seeking new business models to increase profits as they are being forced to compete in the global financial market under liberal market practices dictated by the European Union. Turbulence in the global financial market precipitated by the U.S.
    [Show full text]
  • Global Retail Lending in the Aftermath of the Us Financial Crisis: Distinguishing Between Supply and Demand Effects
    NBER WORKING PAPER SERIES GLOBAL RETAIL LENDING IN THE AFTERMATH OF THE US FINANCIAL CRISIS: DISTINGUISHING BETWEEN SUPPLY AND DEMAND EFFECTS Manju Puri Jörg Rocholl Sascha Steffen Working Paper 16967 http://www.nber.org/papers/w16967 Forthcoming in JournalNATIONAL of Financial BUREAUEconomics. OF We ECONOMIC thank Sanvi Avouyi-Dovi,RESEARCH Hans Degryse, Enrica Detragiache, Valeriya Dinger, Andrew1050 Ellul, Massachusetts Mark Flannery, Avenue Nils Friewald, Luigi Guiso, Andreas Hackethal, Victoria Ivashina, Michael Cambridge,Kötter, Hamid MA Mehran, 02138 José-Luis Peydro, Harry Schmidt, Bill Schwert (the editor), Berk Sensoy, David SmithApril (the 2011 referee), Phil Strahan, Marcel Tyrell, Vikrant Vig, Mark Wahrenburg, as well as seminar participants at the 2010 Western Finance Association (WFA) meetings, 2010 Financial Intermediation Research Society (FIRS) conference, 2010 Interdisciplinary Center (IDC) Herzliya conference, 2010 American Finance Association (AFA) meetings, 2009 UniCredit conference in Rome, 2009 Federal Deposit Insurance Corporation's Center for Financial Research (FDIC CFR) workshop, second Centre for Economic Policy Research and the European Banking Center and the University of Antwerp (CEPR-EBC-UA) Conference on Competition in Banking Markets, 2009 European Central Bank and the Center for Financial Studies (ECB-CFS) Research Network Conference, 2009 CEPR meetings in Gerzensee, Business Models in Banking Conference at Bocconi, FDIC Ninth Annual Bank Research Conference, Recent Developments in Consumer Credit and Payments Conference at Federal Reserve Bank Philadelphia, German Finance Association annual meeting, Bruegel, Deutsche Bundesbank, Duke University, ESMT, HEC Lausanne, Tilburg University, University of Amsterdam, University of Mannheim, and University of North Carolina. We are grateful to the FDIC for funding and to the German Savings Bank Association for access to data.
    [Show full text]
  • Co-Operative Money As a Commons: Convivial Technology for Economic Democracy
    Co-operative Money as a Commons: Convivial Technology for Economic Democracy Paper prepared for the First International Social Transformation Conference University of Split, Faculty of Economics Split, Croatia 10-12 July 2012 Pat Conaty Research Associate Co-operatives UK July 2012 Action to introduce and develop local and interest-free money systems has been seen with every major recession or depression over the past two centuries. The 1820s, 1840s, 1870s, 1930s and 1980s all kicked off monetary reform experiments – sometimes just confined to specific regions but considered during the 1870s and 1930s at the national level with the development of monetary reform parties in North America. Since the beginning of the global banking and now Euro crisis, there has been a new revival and growing level of interest in local and complementary currencies internationally. In many regions of Europe, North America and South America, both citizen and local business engagement with local currencies is growing. Links with credit unions and local banks are now being seen for the first time since the Great Depression. In Germany and Brazil, social banks and community development banks are involved in the provision of new forms of local and social money. In the wake of the global financial crisis, a new creative group of thinkers has emerged to propose national and regional models for reforming and restructuring the money and banking systems in root and branch ways. These ambitious proposals build on the work of innovative reforms developed within the co-op and economic democracy movements. The connections between monetary reform, co- operative economics and an economic democracy agenda is being grappled with by these alternative economic thinkers.
    [Show full text]
  • Incentives of Commercial Banks to Finance Energy Efficiency
    Incentives of commercial banks to finance energy efficiency Anne Schopp, German Institute for Economic Research (DIW Berlin) This paper investigates the incentives of commercial banks for providing energy efficiency lending. Using Germany, Bulgaria, Poland and Ukraine as case studies, interviews were conducted with banks to model their decision making related to energy efficiency. These show that energy efficiency investments differ from other lending projects for three reasons: first, information asymmetries and principal agent problems prevent energy efficiency investments. To overcome these barriers, many public banks provide energy efficiency lending at preferential rates often through commercial banks. Commercial banks reported that this allows them to gain customers. Second, energy efficiency lending is a new field of investment with unconventional revenue streams deriving from cost savings. Energy savings increase the value of the object that serves as collateral and diversify the lending portfolio. However, most banks reported that they do not consider energy efficiency specifics. Third, assessing these energy savings requires additional technical expertise. Therefore, some banks initiated cooperation with energy service providers. The model illustrates the trade-off banks face between initial transaction cost and benefits from portfolio diversification. According to these findings, two aspects are important to upscale energy efficiency lending: first, the requirement for banks to monetise energy savings to account for the benefit of low risk in the lending portfolio and, second, the need for energy efficiency programmes to reach a certain scale so that energy efficiency lending pays off. Keywords: Commercial banks, Energy efficiency lending, Portfolio diversification, Transaction cost 1. Introduction An increasing number of banks offer energy efficiency loans.
    [Show full text]