APRA Proposes Phased Implementation of Reporting Standard ARS 220.0
APRA published a response letter to submissions on the draft Reporting Standard ARS 220.0 on credit exposures and provisions. In response to the industry feedback, APRA is proposing a phased implementation of ARS 220.0. An interim and simplified reporting standard will apply while authorized deposit-taking institutions develop their solutions for delivering the full suite of credit risk data collected by ARS 220.0. The appendix to the response letter outlines the high-level timeframe for the collection of this information; this timeline is indicative and will change as APRA gains a better understanding of the complexities involved in the design of the new collection.
APRA is seeking to incorporate, into the final full reporting standards, data that support the updated credit risk capital framework requirements included in the prudential standard APS 112 on standardized approach to credit risk and the prudential standard APS 113 on internal ratings-based approach to credit risk. As part of the industry feedback to the October 2020 consultation, some authorized deposit-taking institutions indicated that they use pre-2006 versions of Australia and New Zealand Standard Industry Classification (ANZSIC) and indicated that they would need to re-work their systems to be able to report data by industry using ANZSIC 2006. APRA seeks feedback from authorized deposit-taking institutions on the impediments to transitioning to ANZSIC 2006 in time for full ARS 220.0 implementation in early 2023.
APRA is also consulting on the consequential changes to the authorized deposit-taking institution reporting standards and forms that will be affected by the revised Prudential Standard APS 220 on credit risk management. APRA proposes for these consequential changes to be effective from January 01, 2022. APRA is inviting comments on the proposed changes by July 06, 2021. Under the new APS 220, the term impaired will no longer be used and will be replaced with the term non-performing. At present,, eight authorized deposit-taking institution reporting standards and the reporting taxonomy of Reporting Form ARF 743.0 on housing finance use the term impaired and refer to the current APS 220 on credit quality. Consequently, APRA proposes to align these reporting standards and forms to the revised prudential standard by replacing the term impaired with the new term non-performing. The updated draft reporting standards include the following:
- ARS 112.1 on standardized credit risk on-balance sheet assets
- ARS 120.2 on securitization supplementary items
- ARS 199.0 on restricted and individual authorized deposit taking institution
- ARS 210.0 on liquidity
- ARS 220.0 on impaired facilities
- ARS 223.0 on residential mortgage lending
- ARS 230.0 on commercial property
- ARS 325.0 on international operations
Related Links
Comment Due Date: July 06, 2021
Effective Date: January 01, 2022 (Proposed)
Keywords: Asia Pacific, Australia, Banking, Reporting, ARS 220, APS 220, Credit Risk, Regulatory Capital, Standardized Approach, Internal Ratings Based Approach, Residential Ratings Based Approach, APRA
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
Previous Article
ACPR Issues New Version of Functional Business Cards in June 2021Related Articles
OSFI Finalizes on Climate Risk Guideline, Issues Other Updates
The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.
BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending
BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.
HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks
The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.
BCBS Report Examines Impact of Basel III Framework for Banks
The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.
PRA Consults on Prudential Rules for "Simpler-Regime" Firms
Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.
DNB Publishes Multiple Reporting Updates for Banks
DNB, the central bank of Netherlands, updated the list of additional reporting requests and published additional data quality checks and XBRL-Formula linkbase documents for the first quarter of 2023.
NBB Sets Out Climate Risk Expectations, Issues Reporting Updates
The National Bank of Belgium (NBB) published a communication on climate-related and environmental risks, issued an update on XBRL reporting
EBA Updates Address Securitization Standards and DGS Guidelines
The European Banking Authority (EBA) published the final draft of the regulatory technical standards that set out conditions for assessment of homogeneity of the underlying exposures in simple, transparent, and standardized (STS) securitizations.
FSB Publishes Letter to G20, Sets Out Work Priorities for 2023
The Financial Stability Board (FSB) published a letter intended for the G20 Finance Ministers and Central Bank Governors, highlighting the work that FSB will take forward under the Indian G20 Presidency in 2023
ISSB Standards May Become Effective from January 2024
The International Organization of Securities Commissions (IOSCO) welcomed the confirmation statement by the International Sustainability Standards Board (ISSB) setting out its progress in the development of its first sustainability-related corporate disclosure standards.
