EBA Publishes Reporting and Disclosures Framework for Investment Firms
EBA published a package that includes the final draft implementing technical standards on supervisory reporting and disclosures of investment firms. The disclosure requirements will be applicable from June 26, 2021 while the first reporting reference date is September 2021 for quarterly reports and December 2021 for annual reports. These reporting requirements are a part of the EBA reporting framework 3.1, which is expected to apply from September 2021. EBA will also develop the data point model, XBRL taxonomy, and validation rules based on the final draft implementing technical standards.
The standards included in this package set out the main aspects of the new reporting framework in relation to the calculation of own funds, levels of minimum capital, concentration risk, liquidity requirements, and the level of activity in respect of small and non-interconnected investment firms. The implementing technical standards propose a different set of templates to cover small and non-interconnected investment firms and to include information that is proportionate to their size and complexity. The accompanying annexes contain reporting templates and instructions for Class 2 and Class 3 investment firms, information about data point model and validation rules, templates and instructions for disclosure of own funds, and reporting templates and instructions for group capital test. Additionally, one template has been included to define the size and level of activity thresholds that will trigger a shift to the reporting requirements into one or the other classification of investment firms (class 2 and class 3). EBA issued a single set of standards with integrated Pillar 3 disclosures and supervisory reporting requirements and standardized formats and definitions with a view to improving consistency between reporting and disclosures requirements, which will facilitate compliance with both requirements.
The draft implementing technical standards will be submitted to EC for endorsement before being published in the Official Journal of the European Union. The final draft implementing technical standards, which are part of the phase 1 mandates of the EBA roadmap on investment firms, will ensure a proportionate implementation of the new prudential framework for investment firms taking into account the different activities, sizes, and complexity of investments firms. The Investment Firms Prudential Package consists of the Investment Firms Directive (2019/2034 or IFD) and the Regulation (2019/2033 or IFR), which were published in the Official Journal of the European Union on December 05, 2019, entered into force on December 26, 2019, and establish a new prudential framework for investment firms authorized under Markets in Financial Instruments Directive (MiFID). The IFR and IFD package covers small and non-interconnected investment firms (class 3 firms) and other investment firms other than small and non-interconnected investment firms (class 2 firms). IFR requires the development of several pieces of level 2 legislation in to reflect and implement the new requirements for investment firms.
Related Links
Keywords: Europe, EU, Banking, Securities, IFR, IFD, Implementing Technical Standards, Reporting, Disclosures, Investment Firms, EBA
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.
David Fihrer
Skilled life insurance actuary; subject matter expert on IFRS 17 and source of earnings
Previous Article
MNB Revises Principles for Setting MREL for BanksRelated Articles
FINMA Approves Merger of Credit Suisse and UBS
The Swiss Financial Market Supervisory Authority (FINMA) has approved the takeover of Credit Suisse by UBS.
BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks
The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.
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.
APRA Assesses Macro-Prudential Policy Settings, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) published an information paper that assesses its macro-prudential policy settings aimed at promoting stability at a systemic level.
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.
MFSA Sets Out Supervisory Priorities, Issues Reporting Updates
The Malta Financial Services Authority (MFSA) outlined its supervisory priorities for 2023
German Regulators Issue Multiple Reporting Updates for Banks
Deutsche Bundesbank published the nationally deactivated validation rules for the German Commercial Code (HGB) users on the taxonomy 3.2, which became valid from December 31, 2022
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.
