ECB Proposes Integrated Reporting Framework to Reduce Burden for Banks
ECB published input of the European System of Central Banks (ESCB) into the EBA feasibility report on reducing the reporting burden for banks in EU. The ESCB report proposes to reduce the reporting burden for banks in the fields of statistical, resolution, and prudential reporting, without losing the information content that is indispensable to monetary policy, resolution, and supervisory tasks. As part of its mandate under the revised Capital Requirements Regulation or CRR2, EBA was required to conduct a feasibility study and requested that input from the ESCB be taken into account. The Supervisory Board of Single Supervisory Mechanism (SSM) was also consulted on this report.
The report identifies the integration of reporting requirements for statistical, resolution, and prudential reporting as the main priority to reduce the reporting burden. The report also identifies a common standard data dictionary and a common data model as the necessary prerequisites to achieve this. This can be achieved through smarter procedures, such as harmonized transmission reporting formats, the removal of duplications, and improved data sharing between authorities. A joint committee needs to be established to lead this work. It should consist of EBA, ESCB, other relevant European and national authorities, and representatives of the banking industry when implementation aspects are discussed. The report recommends the swift development of an informal joint committee to help steer the main issues until a formal joint committee is legislated by the European Parliament and Council. Moreover, the report identifies a central data collection point as a medium-term objective, while enhanced data-sharing arrangements among authorities can already be promoted by the joint committee in the short term.
This report proposes to achieve a fully integrated reporting framework for statistical, prudential and resolution reporting via two parallel intermediate steps: the integration of the data reported for statistical purposes to ESC, and an integrated system for resolution and prudential reporting. These two parallel work streams should converge as soon as possible, with the aim of achieving a full-fledged integrated system in the medium term. Therefore, the joint committee must ensure a strong level of mutual interaction, for example, through the development of a common standard data dictionary and common data model for the statistical, resolution and prudential reporting frameworks. The overall process requires ambitious and strong engagement for full integration from the outset, accompanied by a step-wise plan and a timeline that will inevitably be spread over many years. These efforts should help to reduce the reporting burden for banks and increase the quality of the data received by authorities. As a result, banks would be able to reduce costs, and authorities could better monitor developments in the banking industry.
Related Links
Keywords: Europe, EU, Banking, ESCB, CRR2, Reporting, Reporting Burden, SSM, Integrated Reporting System, Basel, Statistical Reporting, Resolution Framework, EBA, ECB
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Related Articles
HKMA Finalizes Policy Modules on Group-Wide Approach and Remuneration
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.
EBA Guide to Monitor Threshold for Intermediate Parent Undertakings
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).
PRA Finalizes Approach to Supervision of International Banks
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.
FCA Issues PS21/9 on Implementation of Investment Firms Regime
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
EBA Proposes Regulatory Standards to Identify Shadow Banking Entities
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.
IOSCO Proposes Recommendations on ESG Ratings and Data Providers
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.
ESMA Group Issues Recommendations on RFR Switch in Interdealer Market
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.
ECB Study Assesses Impact of Basel III Finalization Package
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.
ISDA Finds FRTB Results in Higher Capital Charges for Carbon Trading
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.
PRA Updates Remuneration Policy Statement Templates and Tables
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.
