1. The Authority shall monitor and assess market developments in the area of its competence and, where necessary, inform the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority), the ESRB, and the European Parliament, the Council and the Commission about the relevant micro-prudential trends, potential risks and vulnerabilities. The Authority shall include in its assessments an analysis of the markets in which financial institutions operate and an assessment of the impact of potential market developments on such institutions.

2. The Authority shall initiate and coordinate Union-wide assessments of the resilience of financial institutions to adverse market developments. To that end, it shall develop:

(a) common methodologies for assessing the effect of economic scenarios on a financial institution's financial position taking into account inter alia risks stemming from adverse environmental developments;

(aa) common methodologies for identifying financial institutions to be included in Union-wide assessments;

(b) common approaches to communication on the outcomes of those assessments of the resilience of financial institutions;