Featured Product

    PRA Requests Update on Adoption of Recommendations on ECL Disclosures

    February 16, 2021

    PRA issued a letter requesting an update on the progress in adopting the recommendations of the Taskforce on Disclosures about expected credit losses (ECLs). The letter has been issued from Victoria Saporta, Executive Director, Prudential Policy, to the Chief Financial Officers. In the letter, firms are also expected to inform PRA about the plans for adopting the recommendations that have not been adopted in full so far. Responses from firms will help PRA in its work toward encouraging UK banks to embrace the objective underlying the Taskforce’s work, which is the provision of a high-quality, comprehensive, and comparable set of ECL disclosures.

    The Taskforce on Disclosures about Expected Credit Losses has issued two reports on what good ECL disclosures. The first report, which was published in November 2018, sets out recommendations on a comprehensive set of IFRS 9 ECL disclosures. A year later, the Taskforce issued a second report that amended the recommendations in the first report and supplemented those consolidated recommendations with material intended to be helpful in guiding firms toward disclosure formats that are broadly harmonized. In its letter in January 2019, PRA had mentioned that it expects firms to adopt these recommendations in full, consistent with the commitments made in the British Bankers’ Association Code for Financial Reporting Disclosure (BBA Disclosure Code). Firms were encouraged to make progress as quickly as possible and informed that PRA would from time-to-time be asking firms to update on that progress. Thus, PRA is requesting an update on how firms have, to date, responded to that material and what are the plans for responding to it in the future. The letter mentions that providing this information is voluntary. 

    PRA published another letter that is addressed to the Non-Executive Directors who participated in the PRA pilot program of virtual meetings with PRA Senior Advisors that took place in 2020. The objective of these meetings was to provide an informal opportunity to discuss issues and risks that were on board agendas. The meetings addressed, among others, the effect of economic downturn on business models, operational resilience in light of the new working environment, governance challenges, supervisory approach to climate-related financial risks, and feedback, to PRA, on the regulatory landscape. One of the conclusions of these discussions, as stated in the letter, is that it is clear that coronavirus and its aftermath will continue to create uncertainty in the banking and insurance sectors.

     

    Related Links

    Keywords: Europe, UK, Banking, ECL, IFRS 9, Climate Change Risk, Governance, Accounting, Financial Instruments, Disclosures, PRA

    Featured Experts
    Related Articles
    News

    EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models

    The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.

    June 21, 2022 WebPage Regulatory News
    News

    EP Reaches Agreement on Corporate Sustainability Reporting Directive

    The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).

    June 21, 2022 WebPage Regulatory News
    News

    PRA Consults on Model Risk Management Principles for Banks

    The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.

    June 21, 2022 WebPage Regulatory News
    News

    EC Regulation Amends Standards for Calculating Credit Risk Adjustments

    The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    June 21, 2022 WebPage Regulatory News
    News

    BIS Hub Updates Work Program for 2022, Announces New Projects

    The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.

    June 17, 2022 WebPage Regulatory News
    News

    EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance

    The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.

    June 17, 2022 WebPage Regulatory News
    News

    US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule

    Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)

    June 16, 2022 WebPage Regulatory News
    News

    EIOPA Consults on Review of Securitization Framework in Solvency II

    The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.

    June 16, 2022 WebPage Regulatory News
    News

    UK Authorities Issue Regulatory and Reporting Updates for Banks

    The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.

    June 15, 2022 WebPage Regulatory News
    News

    BCBS Issues Climate Risk Principles while HKMA Expresses Its Support

    The Basel Committee on Banking Supervision (BCBS) issued principles for the effective management and supervision of climate-related financial risks.

    June 15, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8280