Article 78 of the CRD IV requires member state competent authorities to make an annual assessment of the quality of internal approaches used for the calculation of own funds requirements. The same article requires the European (EBA) to produce a report to assist competent authorities in this assessment. The EBA’s report is based on data submitted by institutions as specified in implementing technical standards on benchmarking (ITS). These ITS specify the benchmarking portfolios, templates, definitions and IT solutions that should be applied in the annual benchmarking exercises by institutions using internal approaches for market and credit risk.
On 2 March 2015, the EBA published the draft ITS on benchmarking under article 78(8) of CRD IV and submitted them to the European Commission.
On 13 April 2016, the Commission informed the EBA that it intended to amend the final draft ITS submitted by the EBA.
The EBA has now issued an opinion to the Commission expressing agreement with its proposed amendments to the ITS. The EBA plans to annually update the ITS and to maintain them on a regular basis to ensure the success and quality of future benchmarking exercises.