31 July 2012

EBA: Update on the finalisation and implementation of the standards on supervisory reporting

The finalisation and publication of the EBA draft Implementing Technical Standards (ITS) on supervisory reporting requirements for institutions has been pushed back pending the adoption by the EU legislators of the Capital Requirements Regulation (CRR).

As currently foreseen, 1 January 2013 is expected to be the date of application of the CRR. Therefore, financial institutions may face challenges to comply immediately with all the reporting requirements included in the ITS. To address those challenges, some flexibility will need to be given through phase-in provisions or on the implementation date of the new requirements.

Similar practical provisions for phase-in arrangements or elements of flexibility may be considered in the implementation of other technical standards on a case-by-case basis and depending on the final date of entry into force of the CRD IV/CRR package.

Timeline of implementation for the ITS on Reporting

Most respondents to the EBA’s consultation on the reporting ITS stressed that the time to implement the full ITS requirements would not be sufficient as relevant IT systems would need to be changed before the first submission of data to competent authorities.

As competent authorities have the obligation to check institutions’ compliance with the new regulatory framework as of the date of application of the CRR, the submission of relevant data needs to be aligned with the Regulation requirements. Therefore institutions will need to comply with CRR requirements as of its application date (currently foreseen as 1 January 2013) and will need to adapt their systems beforehand.

Areas identified as being the most burdensome for financial institutions are among those which could apply at a later stage. In particular, the EBA acknowledges that a longer time period may be needed, after the entry into force of the CRR currently foreseen 1 January 2013, to prepare some of the reporting systems. Therefore, the implementation date of the full ITS requirements related to financial information (FINREP) should be set to 1 January 2014, providing sufficient time for implementation. Decisions regarding the phase-in of other data requirements may be taken once final CRR provisions are available.

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