Global Trustee and Fiduciary Services Bite-Sized Issue 2 2025

8 QUICK LINKS BENCHMARKS REGULATION CRYPTOASSETS DORA EMIR FSB MIFID II/MIFIR MMF SUSTAINABLE FINANCE/ESG T+1 ASIA EUROPE INTERNATIONAL LUXEMBOURG NETHERLANDS NORTH AMERICA UNITED KINGDOM Global Trustee and Fiduciary Services Bite-Sized | Issue 2 | 2025 MMF ESMA Updates its Guidelines on Stress Test Scenarios Under the MMF Regulation On 7 January 2025, the European Securities and Markets Authority (ESMA) published its updated Guidelines on Stress Test Scenarios under the Money Market Funds (MMF) Regulation. The updated 2024 final report includes: • Additional explanation on the way to report the results of the macro systemic shocks (section 4.8 of the Guidelines); and • Updated guidelines and risk parameters, so that managers of MMFs have the information needed to fill in the reporting template mentioned in article 37 of the MMF Regulation (section 5 of the Guidelines). The annex of this report contains the full text of the updated guidelines and the calibration of the scenarios for 2024 (updates in red). The Guidelines in the annex of this report will be translated into the official EU languages and published on the ESMAwebsite. The publication of the translations will then trigger a two-month period during whichNCAsmust notify ESMAwhether they comply or intend to comply with the guidelines. The updated guidelines in this final report, including the new 2024 parameters, will apply two- months after the publication of the translations of the Guidelines. After the start of the application of the updated guidelines, managers will have to report the results of the new parameters to NCAs with their quarterly reports, for the purpose of the reporting referred to in Article 37 of the MMF Regulation and set out in Commission Implementing Regulation (EU) 2018/7083. Until then, managers should use the parameters set in the 2023 Guidelines and report the results accordingly. Link to Updated Guidelines here SUSTAINABLE FINANCE/ESG FCA Publishes Adaptation Report 2025 On 28 January 2025, the Financial Conduct Authority (FCA) published its Adaption Report 2025, responding to the Department for Environment, Food and Rural Affairs’ (DEFRA) invitation to report on climate change adaptation challenges faced by financial services firms. The FCA says this it has produced this report based on informal engagement with firms and its understanding of market dynamics. It is not a comprehensive assessment and is not intended to set out regulatory expectations for firms. The FCA says that it believes there are three major issues affecting climate change adaptation in the financial services industry: • Data and modelling to help financial services quantify and manage climate related risks; • Barriers and enablers to insurance underwriting for climate related risks and in consequence lending and investment; and • Barriers and enablers to financial services in allocating capital to adaptation. In addition, the FCA states that the report focuses on: • Riskmanagement adjustments that financial services firms need tomake due to climate change; and • The importance of financial products in enabling and supporting adaptation and transition in the wider economy. The FCA explains that these two areas are closely linked because a good understanding of climate risk is needed for both. Link to FCA Adaptation Report 2025 here Link to PRA Climate Change Adaptation Report 2025 here