Consultation paper on Draft Implementing Technical Standards on supervisory reporting requirements for liquidity coverage and stable funding

The European Banking Authority (EBA) launched today a consultation on Draft Implementing Technical Standards (ITS) on supervisory reporting requirements for liquidity coverage and stable funding. These ITS, which will be part of the EU single rulebook, intend to specify the main features (formats, frequencies, IT solutions) of prudential reporting to be applied by financial institutions in Europe. The consultation runs until 27 August 2012.

These ITS will become part of the general supervisory reporting framework. In this respect, they are an addition to the draft ITS text proposed in the Consultation Paper on supervisory reporting for institutions (CP50) published on 20 December 2011 and need to be read in conjunction with them.

Main features of the ITS

These ITS aim at providing national authorities with harmonized information on their liquid assets, inflows and outflows and their stable sources of funding using uniform reporting formats developed by the EBA.
Against this background, this consultation paper puts forward proposals regarding the reporting requirements for both liquidity coverage and stable funding. The purpose of this monitoring is two-fold: (i) to inform the economic impact assessment of the liquidity requirements the EBA is asked to perform during the monitoring period, and (ii) to enable competent authorities to monitor institutions' compliance with the liquidity requirements once they have been introduced as binding minimum standards.

The scope and level of application of these ITS are in line with the Capital Requirements Regulation (CRR) text. The latter provides for the liquidity coverage reporting to be done at least monthly and the stable funding reporting at least quarterly.
These ITS have been developed on the basis of the templates for liquidity reporting used by the EBA in compiling the Basel III monitoring exercise as well as on the COREP and FINREP guidelines. They also build on voluntary reporting exercises conducted predominantly by larger institutions.

Next steps

These draft ITS have been developed on the basis of the European Commission's legislative proposals for the CRR/CRD IV. Following the end of the consultation period, and to the extent that the final text of the CRR changes before the adoption of the ITS, the EBA will adapt its draft ITS accordingly to reflect any developments.

The CRR also mandates the EBA to develop additional liquidity monitoring metrics to provide competent authorities with a comprehensive view of institutions' liquidity risk profiles. The EBA is currently working on these metrics and will launch a public consultation in due course, depending on the timeline that will be adopted in the CRR.

As stated above, the information collected under these ITS will be used to inform the EBA's impact assessment on the introduction of the liquidity requirements. The EBA will disclose the methodology it intends to use for this assessment later this year.   

A separate consultation on a data point model containing all the relevant technical specifications necessary for developing an IT reporting format will be published in the second half of 2012.

Based on the CRR proposals and these ITS, institutions are required to comply with the new reporting requirements as of 1 January 2013. In the current timeline for the implementation of the CRR/CRD IV, the first regular reporting period is expected to be January 2013.