03 November 2016
The European Banking Authority (EBA) published today its final Guidelines on the collection of information related to the internal capital adequacy assessment process (ICAAP) and the internal liquidity adequacy assessment process (ILAAP). These Guidelines aim at facilitating a consistent approach to the supervisory assessment of ICAAP and ILAAP frameworks across the EU as part of the supervisory review and evaluation process (SREP).
These Guidelines introduce a common approach and specify what information regarding ICAAP and ILAAP Competent Authorities should collect from institutions in order to perform their assessments of ICAAP and ILAAP frameworks as well as the reliability of ICAAP and ILAAP capital and liquidity estimates in a consistent manner following the criteria specified in the EBA SREP Guidelines.
In particular, Competent Authorities should collect the following: (i) general information about ICAAP and ILAAP frameworks, business model and strategy, as well as governance arrangements, (ii) ICAAP-specific methodological, policy and operational information; (iii) ILAAP-specific methodological, policy and operational information, and (iv) management conclusions on ICAAP and ILAAP and quality assurance information. In addition, these Guidelines set the criteria for Competent Authorities to organise the collection of ICAAP and ILAAP information taking into account the principle of proportionality, which is recognised in the Guidelines in relation to the frequency, reference and remittance dates, as well as the scope for the ICAAP and ILAAP information that should be determined in relation to the SREP categorisation of institutions.
The Guidelines do not introduce any new ICAAP or ILAAP assessment criteria, nor any specific ICAAP/ILAAP ‘report', but identify information items and their core content recognising that such information can be provided either through a single report specifically prepared by an institution for the purposes of ICAAP/ILAAP submissions, or through separate documents that are already available at the bank.
According to the EBA's impact assessment, introducing greater convergence into the collection of ICAAP and ILAAP information across the EU by means of these Guidelines does not necessarily result in significant additional costs for the institutions, as information is already being collected by Competent Authorities.