Technical Standards on supervisory reporting

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Technical Standards on supervisory reporting




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Presentations text content in Technical Standards on supervisory reporting

Slide1

Technical Standards on supervisory reporting

XBRL UK

17 June 2013

|

London

Meri Rimmanen

|

EBA

Wolfgang Strohbach

|

EBA

Slide2

Outline

Financial supervision in the EU – role of the EBA

Single rulebook and the case for harmonised supervisory data

Technical standards on supervisory reporting – main features

Facilitating implementation of supervisory reporting requirements

Slide3

ESRB

ESFS

EIOPA

EBA

ESMA

Joint Committee

EU central banks

EU supervisors

Macro

prudential

Microprudential

European System of Financial Supervision

Slide4

EBA regulatory tasks

Slide5

Outline

Financial supervision in the EU – role of the EBA

Single rulebook and the case for harmonised supervisory data

Technical standards on supervisory reporting – main features

Facilitating implementation of supervisory reporting requirements

Slide6

Reporting before… and after…

Supervisor 1

Supervisor 3

Supervisor 2

Different

data definitions

Common data definitions, instructions

Several formats Single format

Different technologies IT standards

Supervisor 1

Supervisor 2

Supervisor 3

Group A

Group B

Group C

Group A, B, C

Common

framework

Technical Standards on supervisory reporting

Objective: increase efficiency in reporting systems, enhance data analysis capabilities

Slide7

ITS on supervisory reporting - benefits

Directly applicable

No implementation, or interpretation of the Regulation on national level ensures common definitions and instructions

Technical translation of reporting requirements

Data point model and XBRL taxonomy

Common validation rules

Truly harmonised supervisory data

Helps supervisors to assess asset quality, risk concentrations, liquidity positions, conduct peer analysis, analyse risk parameters across institutions

Harmonised definitions, especially on forbearance, non-performing loans and asset encumbrance significantly enhance identification of potential systemic risks

Slide8

The role of EBA – main objectives and tasks

Main objectives:Establishing EU single rule bookPromoting and enhancing quality and consistency of supervisionReinforcing oversight of cross-border groupsEarly warning of upcoming vulnerabilitiesEffective early intervention and bank resolution

Main tasks: Develop binding technical standards, guidelines, recommendations Promoting common supervisory culture / supervisory practices Peer group analyses and peer reviewsMonitoring effectiveness collegesEU-wide risk assessments and stress testsRisk dashboards Reacting on risk warningsHandling of emergency situations

Slide9

EBA oversight tasks – data usage

Slide10

Benefits of harmonised data

Data

from

banks across the EU provides a

more comprehensive picture on exposures, risks, potential pockets

of

vulnerabilities

Peer analysis, identification of institutions posing systemic risk (outliers)

Provide

high

quality benchmarks for stress testing (harmonised

definitions) and asset quality reviews

Improve analysis on concentration

risk (large exposures, geographical breakdown of exposures)

Facilitate data sharing among competent authorities

Slide11

Outline

Financial supervision in the EU – role of the EBA

Single rulebook and the case for harmonised supervisory data

Technical standards on supervisory reporting

Solvency

Financial reporting

Asset encumbrance

Large Exposures

Liquidity

Leverage ratio

Proportionality

Facilitating implementation of supervisory reporting requirements

Slide12

ITS on supervisory reporting – what is covered

EBA to deliver ITS

in

the following areas

of the Capital Requirement Regulation (CRR

):

Art

99 Solvency reporting, financial reporting

Art 100 Asset encumbrance

Art

101 Mortgage exposures reporting

Art

394 Large

exposures reporting

Art

415 Liquidity ratios reporting

Art

430 Leverage ratio reporting

Integrated

approach to ITS development

Several ITS packaged as one EU

Regulation which is directly applicable to all credit institutions and investment firms

Use of common

structure/conventions/concepts/definitions

Slide13

ITS on supervisory reporting – COREP

Reporting

population

, level of application and scope of consolidation

Credit institutions and investment firms

Consolidated

level and

individual

level

CRD scope of consolidation

Frequency

Quarterly

Exception

:

semi-annually

Material operational risk losses (OPR Details

)

Securitisation transactions (SEC Details)

Reporting delay 6 weeks

Compliance monitoring

Monitoring compliance of capital requirements regulation

Granular information on risk parameters, risk concentrations, securitised exposures

Based on the CEBS reporting

guidelines

Slide14

ITS on supervisory reporting - FINREP

Reporting population

, level of application and scope of consolidation

IFRS

institutions on a consolidated

basis

National supervisory authorities may extend the implementation also to other institutions

CRD scope of consolidation

Frequency

Quarterly, semi-annually and annually

Reporting delay 6

weeks

Monitoring, IFRS-based reporting

Harmonised financial reporting following as much as possible IFRS

Some presentational options have been restricted in order to develop harmonised templates

In some cases the data requirements go beyond IFRS to provide data for

risk assessment and analysis of systemic

risks

Forbearance and non-performing loans reporting

Based on the CEBS reporting

guidelines

Slide15

ITS on supervisory reporting - Modules

Application

Frequency

Objective

Liquidity

Credit institutions and investment firms

Consolidated level and individual level

CRD scope of consolidation

Monthly/quarterly

2/6 weeks reporting delay

Monitoring and calibration

EBA to report to the Commission

Large Exposures

Quarterly

Reporting delay 6 weeks

Compliance monitoring

Concentration risk monitoring

Based on CEBS reporting Guidelines

Leverage Ratio

Monitoring and calibration

EBA to report to the Commission

Asset encumbrance

Monitoring level of encumbered assets

Slide16

Outline

Financial supervision in the EU – role of the EBA

Single rulebook and the case for harmonised supervisory data

Technical standards on supervisory reporting – main features

Facilitating implementation of supervisory reporting requirements

Slide17

ITS on supervisory reporting - Data Point Model

What is the DPM?

A data point is a data element required in the reporting framework, i.e. each template cell will correspond to a data point, and different cells with the same meaning should correspond to the same data point.

The DPM is a data model that captures the information requirements of the reporting framework.

The DPM is a dimensional model, meaning that each data point is categorised by a set of elements of different dimensions.

Why the DPM?

Complex or dubious business concepts are broken down into more elementary concepts, in order to clarify the meaning of a data point.

The DPM expresses the reporting requirements at a logical level, without regard for any particular IT implementation.

The DPM bridges the gap between business and IT languages, providing a common ground of understanding.

The DPM will be the source for the generation of XBRL taxonomies.

Slide18

ITS on supervisory reporting - Proportionality

Reporting requirements shall be proportionate to the nature, scale and complexity of the activities of the institutions

Proportionality included in different ways:

Size of an institution

S

mall institutions are exempted for some templates (asset encumbrance)

Non-significant activities/exposures/risk

Threshold for level of exposure/activity (Geographical breakdown, derivatives in leverage ratio)

Inherent proportionality

Templates reported only if a special approach/method is used or if institution has exposures (SEC, SEC details, IRB)

Reduced frequency

T

emplates where reduced frequency provides adequate data (Group structure, detailed and contingent asset encumbrance)

Slide19

Facilitating implementation – Q&A mechanism

Uniform interpretation of data requirements across EU

Detailed instructions included in the

ITS Annexes

Q&A tool on EBA website (as of July 2013)

Public can post their questions via a web tool

EBA will

Review, categorise and prioritise questions

Publish all answers

Translate answers

where necessary

Slide20

Facilitating implementation – General timeline

Slide21

Facilitating implementation – amendments of the ITS

Currently under consultation

Asset encumbrance

Forbearance and Non-performing loans (FINREP)

Liquidity monitoring tools

The ITS will be amended with these parts after the consultations

Application dates will be later than 1 January 2014

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