EC published the Commission Delegated Regulation, or CDR, (EU) 2017/2295 laying out regulatory technical standards for disclosure of encumbered and unencumbered assets. CDR (EU) 2017/2295 supplements Capital Requirements Regulation (CRR)—that is, Regulation (EU) No 575/2013. CDR (EU) 2017/2295 shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union and Article 2 of the regulation shall apply from January 02, 2019.
CDR (EU) 2017/2295 specifies the requirements for disclosing the amount of encumbered and unencumbered assets for the institutions covered in this regulation. Annexes to this regulation contain disclosure templates for encumbered and unencumbered assets (Annex 1), along with instructions (Annex 2). Article 1 of the regulation specifies the following:
- Institutions shall disclose the amount of encumbered and unencumbered assets under the applicable accounting framework by asset type in columns C010, C040, C060, and C090 of Template A of Annex I, in accordance with the instructions in Annex II.
- Institutions shall disclose information on collateral received by asset type in columns C010 and C040 of Template B of Annex I, in accordance with the instructions in Annex II.
- Institutions shall disclose the liabilities associated with encumbered assets and collateral received as set out in Template C of Annex I, in accordance with the instructions in Annex II.
- Institutions shall disclose narrative information relating to the impact of their business model on their level of encumbrance and the importance of encumbrance in their business model as set out in Template D of Annex I, in accordance with the instructions in Annex II.
To ensure the proportionate application of the disclosure requirements set out in Article 443 of CRR to the smaller institutions that do not have material levels of asset encumbrance, information on the quality of encumbered and unencumbered assets should not be required from such smaller institutions. This regulation is based on the draft regulatory technical standards submitted by EBA to EC. EBA has conducted open public consultations on the draft regulatory technical standards on which this Regulation is based, analyzed the potential related costs and benefits, and requested the opinion of the Banking Stakeholder Group, established in accordance with Article 37 of Regulation (EU) No 1093/2010 of the European Parliament and of the Council.
Effective Date: January 02, 2018
Keywords: Europe, EU, Banking, Encumbered and Unencumbered Assets, Reporting, Disclosures, CRR, EC
Previous ArticleUS Agencies Propose to Extend Certain Capital Rule Transitions
HKMA announced the publication of a report on fintech adoption and innovation in the banking industry in Hong Kong.
BIS published a working paper that examines the drivers of cyber risk, especially in context of the cloud services.
ECB launched consultation on a guide specifying how the Banking Supervision expects banks to consider climate-related and environmental risks in their governance and risk management frameworks and when formulating and implementing their business strategy.
ECB published an opinion (CON/2020/16) on amendments to the prudential framework in EU in response to the COVID-19 pandemic.
EBA published a report that examines the interlinkages between recovery and resolution planning under the Bank Recovery and Resolution Directive (BRRD).
SRB published the final Minimum Requirements for Own Funds and Eligible Liabilities (MREL) policy under the Banking Package.
EIOPA published its risk dashboard based on Solvency II data from the fourth quarter of 2019.
MNB published a statement on loan payments post the announced moratorium, in addition to a set of new questions and answers (Q&A) on supervisory measures and requirements announced amid COVID-19 pandemic.
EBA updated the Single Rulebook question and answer (Q&A) tool for banks.
US Agencies (FDIC, FED, and OCC) published an interim final rule that temporarily revises the supplementary leverage ratio calculation for depository institutions.