ESMA Guidelines in Malta: A Guide to Delayed Disclosure of Inside Information

The European Securities and Markets Authority (ESMA) has released a final report amending its guidelines on the delay of disclosure of inside information under the Market Abuse Regulation (MAR). The revised guidelines aim to provide clarity on when issuers can delay public disclosure of inside information, particularly in relation to the banking sector.

Supplemented List of Legitimate Interests

According to the amended MAR guidelines, the list of legitimate interests of issuers for delaying public disclosure of inside information has been supplemented. This is intended to assist issuers in assessing whether they meet the conditions to delay the disclosure of inside information in terms of MAR.

Clarifications on Prudential Supervision

The guidelines introduce clarifications on institutions’ case-by-case assessment as to whether they would be in possession of inside information in relation to the institution-specific Supervisory Review and Evaluation Process (SREP) decisions received from their prudential competent authority. Specifically, the guidelines clarify that:

• An institution has a legitimate interest to delay disclosure of inside information until supervisory authorization is granted for redemptions, reductions, and repurchases of own funds.
• Institutions have a legitimate interest in delaying disclosure of draft SREP decisions informally communicated to them until those decisions become final following completion of the prudential competent authority’s decision-making process.

Clarification on Pillar 2 Capital Requirements

The guidelines specify that:

• Pillar 2 Capital Requirements are expected to be considered as inside information and highly likely to be price-sensitive.
• Pillar 2 Capital Guidance may only be inside information if there is a significant difference between an institution’s level of capital and its Pillar 2 Capital Guidance, or if the institution’s Pillar 2 Capital Guidance does not align with market expectations.

Examples of Price Sensitivity

Examples provided in the guidelines suggest that price sensitivity is expected when:

• There is a significant difference between an institution’s level of capital and its Pillar 2 Capital Guidance.
• The institution’s Pillar 2 Capital Guidance does not align with market expectations.

Implementation Date

The revised guidelines are expected to become applicable two months after publication of the translations of the final report.

Important Note

This article provides a general guide to the subject matter and should not be relied upon as specific advice. Specialist advice should be sought regarding individual circumstances.