The Bank Recovery and Resolution Directive (BRRD) sets out a minimum list of information items that resolution authorities may request and mandates the European Banking Authority (EBA) to develop implementing technical standards (ITS) to specify “procedures and a minimum set of standard forms and templates for the provision of information” for resolution plans.
Acting upon its mandate the EBA developed the current ITS on reporting for resolution plans, which were endorsed by the European Commission in 2016. The ITS set out 12 templates covering, inter alia, organization structures, information systems, critical functions and core business lines and liabilities structures. They also lay down some basic procedural requirements, e.g. on relations with supervisors and on format.
Recently, the EBA has assessed with resolution authorities the early experience gained in the use of the templates and came to the conclusion that it is necessary to review the current ITS. The EBA has therefore now issued a consultation paper that seeks to elicit stakeholder views on planned changes to the ITS.
The revised ITS pursues three objectives:
- first, it will clarify the scope of the reporting framework in line with the BRRD. The amended ITS will establish a minimum set of reporting obligations for institutions. However, the ITS will not prevent resolution authorities from requiring additional information necessary to draw up or implement resolution plans. They will also respect the right of resolution authorities, recognised in the BRRD, to set simplified reporting obligations for institutions the failure of which would have limited impact on financial stability;
- second, leveraging on established experience in supervisory reporting, the revised ITS will further specify the minimum procedural and technical reporting requirements. Institutions will be able to rely on a minimum harmonised reporting schedule and set of reporting levels and frequencies. The extension of the EBA’s data point model to resolution reporting templates will improve data quality and allow automated collection, quality control and exchange; and
- third, the revised ITS will update the templates taking into account the latest experience available.
The EBA has taken into account the objective of proportionality and the burden on institutions:
- resolution authorities will retain the right to set simplified reporting obligations;
- the templates have been calibrated to avoid any unnecessary reporting and minimize duplicate reporting; and
- while some data requirements are reproduced from the supervisory reporting framework this is considered proportionate because those requirements will be defined consistently and on the basis of the same model. This should minimize the burden for banks or enable resolution authorities to obtain the information directly from the supervisory authorities.
The deadline for comments on the consultation paper is 11 December 2017. The new framework could be operational in 2019 when resolution authorities collect information as of 31 December 2018.
View EBA consults on draft ITS on reporting for resolution plan under BRRD, 11 October 2017