Media and events

The EBA has published this year its Guidelines on the management of Environmental, Social and Governance (ESG) risks.

The Guidelines cover minimum standards and reference methodologies for the identification, measurement, management and monitoring of ESG risks by institutions. They complement the Guidelines on the management of ESG risks on the area of scenario analysis, which were published last year.

In our response to the EBA consultation we highlighted the role of the leasing industry in facilitating the green transition for businesses and households alike and stressed the importance of proportionality in the disclosure of climate-related risks.

Social Leasing encompasses a multitude of financing solutions from pure operating leases without transfer of ownership to true consumer finance, Leaseurope is providing expert input to the Commission to help establish a framework ensures the interests of our industry are taken into account.

The European Commission has published a package of measures to make the EU securitisation framework simpler and more fit for purpose. The proposed measures seek to facilitate securitisation activity in the EU while continuing to safeguard financial stability. A stronger and simpler securitisation framework can help channel more investments into the real economy – supporting economic growth, innovation and job creation across the EU. This review is the first legislative initiative proposed under the savings and investments union (SIU) strategy.

Leaseurope is currently analysing the proposals to ensure the final legislative amendments will fit the specifies of securitisations issued by leasing companies.

“The proposed measures seek to facilitate securitisation activity in the EU while continuing to safeguard financial stability.”

Although the European Commission’s Omnibus simplification package is likely to lead to significant changes to sustainability reporting requirements, many lessors are already needing to report at least some key metrics including Scope 1, 2 and 3 emissions and, for banks, the Green Asset Ratio. Leaseurope has continued to seek confirmation that lessors should report emissions of leased equipment only as Scope 3. We have also called for clarification of value chain reporting requirements, to confirm that lessors who do need to report can rely on readily available information from manufacturers.

Meanwhile to assist lessors, Leaseurope’s Taskforce on Sustainability and ESG reporting has prepared voluntary guidance that has been distributed to member associations. Leaseurope has also defined a new voluntary reporting measure, Transition Asset Finance.

In June, The European Commission adopted a new State aid framework supporting the Clean Industrial Deal, to enable Member States to push forward the development of clean energy, industrial decarbonisation and clean technology. The new Clean Industrial State Aid Framework (CISAF) sets out how Member States can design State aid measures to support objectives related to the Clean Industrial Deal.

Leaseurope’s input to the earlier draft CISAF rules led to improvements including new specific references to the inclusion of state aid when leasing, and the removal of a requirement that could have excluded captive lessors.

Following Leaseurope’s milestone to secure in the Capital Requirements Regulation III (CRR III) a specific clause for leasing exposures (Article 495c) whereby the European Banking Authority (EBA) is mandated to adopt a report on leasing calibrations within 36 months after CRR III enters into force, we started discussions with the EBA on the methodology and data templates required to undertake the analysis.

Leaseurope is in regular contact with the EBA in relation to this specific mandate and will provide support to the EBA on the production of this report on the appropriate calibrations of risk parameters associated with leasing exposures under the IRB Approach, and of risk weights under the Standardised Approach.