EC published Regulation 2021/637 that lays down implementing technical standards for public disclosures of certain information, as referred to in Titles II and III of Part Eight of the Capital Requirements Regulation or CRR (575/2013). Regulation 2021/637 lays down a consistent and complete Pillar 3 disclosure framework to implement the amendments introduced in CRR2 (2019/876). Annexes to this final regulation present disclosure templates and instructions. Regulation 2021/637 shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union and shall apply from June 28, 2021.
Regulation 2021/637 repeals Regulations 1423/2013, 2015/1555, 2016/200, and 2017/2295, which specify uniform formats, templates, and tables for own funds, the countercyclical capital buffers, the leverage ratio, and asset encumbrance, respectively. The Regulation 2021/637 stipulates that Institutions shall provide information on disclosure reference date and reference period, reporting currency, name, and legal entity identifier (LEI) of the disclosing institution; the accounting standard used; and the scope of consolidation. The implementing standards regulation covers templates for disclosure of metrics related to own funds requirement, countercyclical capital buffers, liquidity requirements, standardized and internal ratings-based approaches to credit risk, specialized lending and equity exposure under the simple risk-weight approach, exposures to securitization positions, operational risk, and the use of the standardized approach and of the internal models for market risk. The regulation also lays down disclosure standards, related templates, and instructions to implement certain other amendments introduced in CRR2, which include:
- A new calibrated leverage ratio and the leverage ratio buffer for global systemically important institutions
- The standardized approaches for counterparty credit risk, with a Standardized Approach for Counterparty Credit Risk (SA-CCR) and a Simplified SA-CCR for institutions that meet the predefined eligibility criteria.
- Certain disclosure requirements for net stable funding ratio and performing, non-performing, and forborne exposures, including the disclosure of information on collaterals and financial guarantees received
- Certain remuneration-related disclosure requirements, to ensure that remuneration policies and practices for categories of material risk-takers are consistent with effective risk management
In addition, EU published, in the Official Journal of the European Union, a corrigendum to Regulation 2021/451 that lays down implementing technical standards for the application of CRR with regard to supervisory reporting of institutions. The corrigendum concerns changes to the reporting template for the net stable funding ratio. Regulation 2021/451 repealed the Implementing Regulation 680/2014 on supervisory reporting.
Effective Date: May 11, 2021
Keywords: Europe, EU, Banking, Pillar 3, Disclosures, Reporting, Basel, Implementing Technical Standards, Regulatory Capital, NSFR, CRR, EC
Previous ArticleRBNZ to Lead Implementation of Deposit Takers Act
The European Banking Authority (EBA) published the final draft regulatory technical standards on disclosure of investment policy by investment firms, under the Investment Firms Regulation (IFR).
The European Banking Authority (EBA) published version 5.1 of the filing rules for supervisory reporting.
The European Central Bank (ECB) Guideline 2021/1829 on the procedures for the collection of granular credit and credit risk data has been published in the Official Journal of European Union.
The Australian Prudential Regulation Authority (APRA) published the prudential practice guide CPG 511 to assist banks, insurers, and superannuation licensees in meeting requirements of CPS 511, the new prudential standard on remuneration.
The Office of the Comptroller of the Currency (OCC) published a bulletin that provides an updated self-assessment tool for banks to evaluate their preparedness for cessation of the London Interbank Offered Rate (LIBOR).
The Financial Stability Board (FSB) published a report that examines the progress made toward disclosures aligned with recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
The Basel Committee on Banking Supervision (BCBS) published the progress report on adoption of the Basel III regulatory framework in member jurisdictions.
The French Prudential Supervisory Authority (ACPR) has implemented, in its information system, updates linked to the Data Point Model (DPM) version 3.1.
The European Banking Authority (EBA) published a thematic note that aims to identify and raise awareness of the transition risks of benchmark rates, as the London Interbank Offered Rate (LIBOR) and the Euro Overnight Index Average (EONIA) are close to being phased out.
In a letter to the federally regulated financial institutions and pension plans, the Office of the Superintendent of Financial Institutions (OSFI) published a summary of the feedback received to the January 2021 discussion paper on ways to address climate risks.