EC published the Regulation 2021/451 that sets out the new implementing technical standards for supervisory reporting of institutions, following revisions to the Capital Requirements Regulation (CRR). With this regulation, EC is repealing the earlier Implementing Regulation 680/2014 on supervisory reporting standards. Regulation 2021/451 lays down the uniform reporting formats and templates, instructions and a methodology on the use of these templates, the frequency and dates of reporting, and the definitions and the information technology solutions for reporting to the competent authorities. The Annexes to Regulation 2021/451 contain reporting templates and instructions. Regulation 2021/451 has been published in the Official Journal of the European Union, with March 20, 2021 as the specified date for its entry into force. Regulation 2021/451 shall apply from June 28, 2021, with certain exceptions.
Taking into account the international standards of BCBS, CRR2 (2019/876) amended CRR in a number of aspects, such as the leverage ratio, the net stable funding requirement, requirements for own funds and eligible liabilities, counterparty credit risk, market risk, exposures to central counterparties, exposures to collective investment undertakings, large exposures, and reporting and disclosure requirements. The reporting framework laid down in Regulation 680/2014 is, therefore, being revised and the set of templates for the collection of information for supervisory reporting purposes are being updated. Among others, Regulation 2021/451 lays down the implementing standards for:
- Reporting thresholds: entry and exit criteria
- Quarterly and semi-annual reporting on own funds and own funds requirements on an individual basis
- Reporting on own funds and own funds requirements on a consolidated basis
- Reporting on own funds and own funds requirements for investment firms subject to Articles 95 and 96 of CRR on individual and consolidated basis
- Reporting on financial information on a consolidated basis for institutions subject to Regulation 1606/2002
- Reporting on financial information on a consolidated basis for institutions applying national accounting frameworks
- Reporting on losses stemming from lending collateralized by immovable property in accordance with Article 430a(1) of CRR on an individual and a consolidated basis
- Reporting on large exposures on an individual and a consolidated basis
- Reporting on leverage ratio on an individual and a consolidated basis
- Reporting on the liquidity coverage requirement on an individual and a consolidated basis
- Reporting on stable funding on an individual and a consolidated basis
- Reporting on additional liquidity monitoring metrics on an individual and a consolidated basis
- Reporting on asset encumbrance on an individual and a consolidated basis
- Supplementary reporting on a consolidated basis for the purposes of identifying global systemically important institutions (G-SIIs) and assigning G-SII buffer rates
- Data exchange formats and information accompanying submissions
Provisions on reporting for groups that consist only of investment firms subject to Articles 95 and 96 of CRR on an individual basis or a consolidated basis shall cease to apply on June 26, 2026. Regulation 2021/451 states that institutions should start supervisory reporting from the end of the second quarter of 2021. However, reporting for the leverage ratio buffer should start from January 2023, as Regulation 2020/873 has postponed the application of the leverage buffer requirements to January 2023. Regulation 2020/873 amended CRR and CRR2 to make certain adjustments in response to the COVID-19 pandemic.
Effective Date: March 20, 2021
Keywords: Europe, EU, Banking, Basel, Reporting, COVID-19, Implementing Technical Standards, Investment Firms, CRR2, Reporting Framework 3.0, EC
The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.
The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).
In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.
The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.
The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.
The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.
The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.