Response to consultation on Implementing Technical Standards on amended disclosure requirements for ESG risks, equity exposures and aggregate exposure to shadow banking entities

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1. Do you have any comments on the proposed set of information for Large institutions?

2. Do you have any comments on the simplified set of information for Other listed institutions and Large subsidiaries?

3. Do you have any comments on the simplified set of information proposed for SNCI and other non-listed institutions?

4. Do you have any comments on the proposed approach based on materiality principle to reduce the frequency (from semi-annual to annual) of specific templates (qualitative, template 3, and templates 6-10) for large listed institutions?

5. Do you have any comments on the transitional provisions and on the overall content of section 3.5 of the consultation paper?

6. Do you have any comments on the proposed amendments to Table 1 and Table 3?

7. Do you have any further suggestions on Table 1A?

8. Do you have any comments on the proposed additions and deletions to the sector breakdown?

9. Do you have any views with regards to the update of the templates to NACE 2.1?

10. Do you have any views with regards to NACE code K – Telecommunication, computer programming, consulting, computing infrastructure and other information service activities, and in particular K 63 - Computing infrastructure, data processing, hosting and other information service activities, whether these sectors should be rather allocated in the template under section Exposures towards sectors that highly contribute to climate change?

11. Do you have any comments on the inclusion of row “Coverage of portfolio with use of proxies (according to PCAF)”?

12. Do you have any further comments on Template 1?

13. Do you have any comments or alternative suggestions for SNCIs and other institutions that are not listed, regarding the sector breakdown?

14. Do you have any additional suggestions how to adjust Template 1A for SNCIs and other institutions that are not listed?

15. Do you have any further comments on Template 1A?

16. Should Template 2 in addition include separate information on EPC labels estimated and about the share of EPC labels that can be estimated?

17. Should rows 2, 3 and 4 and 7, 8 and 9 for the EP score continue to include estimates or should it only include actual information on energy consumption, akin to the same rows for EPC labels?

18. Do you have any comments on the inclusion of information on covered bonds?

Transparency regarding information on the cover pool is a key prerequisite for the confidence of covered bond investors.

According to Art. 14 Covered Bond Directive (EU) 2019/2162 issuers must report on information of the cover pool and on credit risk, market risk and liquidity risk on a quarterly basis. In Germany, transparency is addressed with Art. 28 PfandBG and Art. 28 PfandBG reports of (37) vdp member institutions are made available on the vdp website in a uniform format suitable for further processing of the data.

On a global level, issuers that have committed compliance with the Covered Bond Label Convention provide quarterly information on their website following the Harmonised Transparency Template which is in compliance with the transparency requirements of Article 14 of the Covered Bond Directive (Directive (EU) 2019/2162. The Label includes 157 issuers (30.6.2025), representing a total of 194 cover pools across 25 jurisdictions.

However, we note that, to date, private investors in covered bonds have not yet demonstrated an increasing demand for energy performance metrics of the cover pools. In contrast, investors in green covered bonds do, however, demand information the energy performance data and saved energy and CO2 emissions of the green cover pool assets.

Despite this, we acknowledge that, as a dual recourse product, covered bonds are exposed to climate risks at issuer and cover pool levels in the event of an issuer default. Therefore, we generally support the proportionate disclosure of information on environmental transitional risks of all cover pool loans collateralised by immovable property as included in Template 2: Banking book - Climate change transition risk: Loans collateralised by immovable property - Energy efficiency of the collateral.

We welcome the proposed scope of the requested information on cover pools, as the established breakdown by EP scores and EPC labels, along with the provided estimates, gives investors an appropriate level of knowledge regarding the energy efficiency of the properties securing the cover assets. The breakdown by EP scores contributes to standardised, comparable metrics across the EU. Similarly, the breakdown of EPC labels contributes to standardised, comparable metrics across issuers at least within the same region until EPC labels are more available in many countries and are harmonized across the EU.

In addition, we believe that reporting energy efficiency information semi-annually or annually is an appropriate frequency, as these property characteristics don’t change quickly.

Another conceivable solution to disclose relevant information would be the transparency requirements set out in Art. 14 of the Covered Bond Directive which already contains information requirements on credit, market and liquidity risk.

This is supported by the fact that including energy performance information on cover pools within the overall disclosure report (Pillar 3) would burden investors due diligence efforts. It would force them to navigate 2 sources: a) the standard transparency template used by issuers to comply with Art. 14 CBD to report information on the cover pool as well as on credit-, market and liquidity risks and b) the template 2 of the Pillar 3 report for further information on climate risk which on top often have between 150 and 300 pages. It has to be seen whether the introduction of ESAP would solve this problem. Another point that adds complexity to finding the relevant cover pool information when including it in the Pillar 3 report is that for some issuers the information may be integrated into the group consolidated Pillar 3 report.

In any case, however, a double reporting obligation must be avoided, especially with different data requirements.

19. Do you have any comments on the breakdown included in columns b to g on the levels of energy performance?

20. Do you have any further comments on Template 2?

21. Do you have any comments on Template 3?

22. Do you have any comments with the proposals on Template 4 and the instructions?

23. Do you have any views on whether this template could be improved with some more granular information in the rows, by requesting e.g. split by sector of counterparty or other?

24. Do you have any further comments on Template 4?

25. Do you have any comments on the proposal using NUTS level 3 breakdown for Large institutions and NUTS level 2 for Other listed institutions and Large subsidiaries? Would NUTS level 2 breakdown be sufficient for Large institutions as well?

26. Do you have any comments on the instructions for the accompanying narrative and on whether they are comprehensive and clear?

27. Do you have any further comments on Template 5 and on its simplified version Template 5A?

28. Do you have any comments on the proposal to fully align templates on the GAR, that is, templates 7 and 8, with those under the Taxonomy delegated act by replacing the templates with a direct cross reference to the delegated act?

29. Do you have any comments on the proposal related the BTAR and to keep it voluntary?

30. Do you have any comments regarding the adjustments to template 10?

31. Do you have any further comments on the Consultation Paper Pillar 3 disclosures requirements on ESG risk?

32. Are the new template EU SB 1 and the related instructions clear to the respondents? If no, please motivate your response.

33. Do the respondents agree that the new template EU SB 1 and the related instructions fit the purpose and meet the requirements set out in the underlying regulation?

34. Are the amended template EU CR 10.5 and the related instructions clear to the respondents? If no, please motivate your response.

35. Do the respondents agree that the amended template EU CR 10.5 and the related instructions fit the purpose and meet the requirements set out in the underlying regulation?

36. Do the respondents consider that the “mapping tool” appropriately reflects the mapping of the quantitative disclosure templates with supervisory reporting templates?

Name of the organization

Verband deutscher Pfandbriefbanken e. V. | Association of German Pfandbrief Banks