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Harmonisation of the European Reporting Framework COREP | 19 November 2009.

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Presentation on theme: "Harmonisation of the European Reporting Framework COREP | 19 November 2009."— Presentation transcript:

1 Harmonisation of the European Reporting Framework COREP | 19 November 2009

2 COREP progress report | 19 November COREP (Common Reporting) Scope: Solo and consolidated prudential information collected by national supervisors and based on EU Basel II implementation (CRD – 2006/48/EC and 2006/49/EC) Objective: develop a common language for communication in the context of a common European framework (convergence) First released: January 2006 Structure: –core information (homogen) –standardised supplemental information (flexible) –extentable Implementation in EU: –27 countries –2/3 of content

3 COREP progress report | 19 November COREP Operational Network Committee of European Banking Supervisors (CEBS) Group de Contact (GdC) Expert Group Prudential Regulation (EGPR) Expert Group Financial Information (EGFI) Subgroup Reporting COREP Operational Network At the moment 36 members and observers of 19 member states and of ECB Aims of the network (among others): To adress technical questions about COREP To perform the technical maintenance of the Framework

4 COREP progress report | 19 November COREP - Projects of COREP Operational Network 1.Revision of COREP Framework in order to amend templates because of CRD 2 amendments 2.Revision of COREP Framework in order to amend templates because of CRD 3 amendments 3.Streamlining and harmonisation of the current COREP Framework

5 COREP progress report | 19 November COREP - Projects of COREP Operational Network 1.Revision of COREP Framework in order to amend templates because of CRD 2 amendments 2.Revision of COREP Framework in order to amend templates because of CRD 3 amendments 3.Streamlining and harmonisation of the current COREP Framework Uniform reporting formats Impact assessment

6 COREP progress report | 19 November COREP – implementation of CRD amendments Amendments stemming from CRD 2 (technical amendments, hybrid instruments, securitisation etc.) Templates affected: Own Funds: CA Credit Risk: CR SA, CR IRB, CR SEC SA, CR SEC IRB, CR SEC Details Operational Risk: OPR Details, OPR loss details

7 COREP progress report | 19 November Example CA template: COREP – implementation of CRD amendments Memorandum items: hybrid instruments *Of which: Grandfathered instruments with incentive to redeem subject to limit **Of which: Grandfathered instruments without incentive to redeem subject to limit Hybrid instruments that must be converted during emergency situations Article 65(1) point a); Article 66 (1a) lit. a; Article 154 (8) and (9) of Directive 2006/48/EC Hybrid instruments (undated, without incentive to redeem) Article 65(1) point a); Article 66 (1a) lit. b; Article 154 (8) and (9) of Directive 2006/48/EC Hybrid instruments (dated or incentive to redeem) Article 65(1) point a); Article 66 (1a) lit. c; Article 154 (8) and (9) of Directive 2006/48/EC

8 COREP progress report | 19 November COREP – implementation of CRD amendments Amendments stemming from CRD 3 (resecuritisation, trading book) Templates affected: CA CR SEC SA, CR SEC IRB, SEC Details MKR SA TDI, MKR SA EQU, MKR IM, MKR IM Details Adding new templates MKR SEC/RESEC SA, MKR SEC/RESEC IRB

9 COREP progress report | 19 November COREP – implementation of CRD amendments Timeline for the revision of COREP incorporating CRD changes that will be applicable starting end 2010 December 2009Endorsement of revised COREP by CEBS 2010National implementation for supervisors and institutions as well End 2010Start of application

10 COREP progress report | 19 November COREP - Projects of COREP Operational Network 1.Revision of COREP Framework in order to amend templates because of CRD 2 amendments 2.Revision of COREP Framework in order to amend templates because of CRD 3 amendments 3.Streamlining and harmonisation of the current COREP Framework Uniform reporting formats Impact assessment

11 COREP progress report | 19 November COREP - uniform reporting formats Article 74 para 2 subpara 2 a (new) For the communication of these calculations by credit institutions, competent authorities shall apply, by 31 December 2012, uniform formats, frequencies and dates of reporting. To facilitate this, the Committee of European Banking Supervisors shall elaborate guidelines to introduce, within the Community, a uniform reporting format at the latest by 1 January The reporting formats shall be proportionate to the nature, scale and complexity of the credit institutions' activities. A new CRD requirement

12 COREP progress report | 19 November Reporting before… and after… Supervisor 1 Supervisor 3 Supervisor 2 Different templates and definitions Common templates and definitions Several formatsSingle format Different technologiesXBRL recommended Supervisor 1 Supervisor 2 Supervisor 3 XBRL Group A Group B Group C Group A, B, C Common framework XBRL COREP – uniform reporting formats

13 COREP progress report | 19 November Timeline for the revision of COREP incorporating streamlining changes that will be applicable starting end 2012 COREP – uniform reporting formats Development of a streamlined framework by COREP ON CEBS Endorsment December 2010 Analysis of commonality: 07/ 2008 – 11/ 2008 User Test: 12/ 2008 – 09/ 2009 Consultation Phase: 06 to 09/ 2010 Implementation 2011/ 2012 Application from 31/12/2012 Impact Assessment 05/ 2009

14 COREP progress report | 19 November COREP – Impact Assessment COREP ON conducted an Impact Assessment Step 1: Problem identification Step 2: Definition of policy objectives Step 3: Definition of policy options/ changes Step 4: Assessment of likely costs and benefits Step 5: Identification of the preferred policy option

15 COREP progress report | 19 November COREP – Impact Assessment Why there are different reporting requirements in Europe? Basis: Common Reporting Framework Legal differences: differences among national legislations (e.g. national discretions of CRD) and differences in accounting rules among Member States e.g. CRD IV, CRD Transposition Group 2.Reporting differences: Differences in the reporting templates (use of core and details information), frequencies and remittance dates COREP streamlining and harmonisation 3.IT differences: differences in the use of data standards for electronic filing as well as in submission requirements e.g. XBRL network

16 COREP progress report | 19 November COREP – Impact Assessment Questions to Workshop participants: 1.Which elements in COREP templates create problems referring to the reporting system of a multinational institution? E.g. Recognition of hybrid instruments, problem: if grandfathered instruments were subject to different limits than new hybrid instruments 2.What elements shall the technical annex to revised COREP guidelines include? E.g. Detailed data definitions and references in COREP GL to facilitate uniform implementation and banks internal cross checks/reconciliations... to support software providers/ease IT implementation?

17 COREP progress report | 19 November COREP – Impact Assessment Follow up: It is our intention to involve financial institutions and software providers into the streamlining process at an early stage of the process in order to receive more information concerning the possibilities to enhance COREP. Therefore we would appreciate your comments on the questions of the previous slide by 11 December Please be as detailed as possible, because the more detailed information we get, the better your input can be incorporated in the process.

18 COREP progress report | 19 November COREP Thank you!

19 Contact details: Name: Daniela Jentsch Name: Wolfgang Strohbach


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