Response to consultation on draft Implementing Technical Standards (ITS) on disclosure for leverage ratio
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There is room for interpretation of data field LRSpl {EU-30}. We believe that this field relates to the prudential exposure measure. However, in our view the data field description could be clarified to confirm this reading. This could, e.g. be achieved by linking this data field to LRSum {01;20}.
Are the instructions provided in annex 2 on the breakdown of leverage ratio exposure of LRCom and LRSpl sufficiently clear? Should the instructions for some rows be clarified? Which ones in particular? Are some rows missing?
Table LR Com requires banks to make extra disclosures about off balance sheet exposures by breaking them down by material product types. This requirement goes over and above what is required in COREP. We question the usefulness of a breakdown by product type given that other disclosures in the Annual Report and Accounts or the Pillar 3 report are not generally provided at that level of granularity. We also believe that a weakness of the proposed approach is that each bank can make its own determination about materiality and product type. This will lead to a lack of comparability which could render this additional level of disclosure relatively meaningless. We propose that in light of BCBS’s recent revisions to the leverage ratio, the EBA should re-issue its proposals - this would provide a good opportunity for the EBA to work with the industry to develop a breakdown of off-balance sheet exposures that ensures consistency of disclosure as well as providing useful information.There is room for interpretation of data field LRSpl {EU-30}. We believe that this field relates to the prudential exposure measure. However, in our view the data field description could be clarified to confirm this reading. This could, e.g. be achieved by linking this data field to LRSum {01;20}.