The Basel Committee on Banking Supervision (BCBS) has published its final standard for the revised Pillar 3 disclosure requirements.
The revised requirements will take effect from end-2016. They supersede the existing Pillar 3 disclosure requirements first issued as part of the Basel II framework in 2004 and the Basel 2.5 revisions and enhancements introduced in 2009.
A key goal of the revised Pillar 3 disclosures is to improve comparability and consistency of disclosures. To this end, harmonised templates are introduced. However, the BCBS recognises that a balance needs to be struck between the use of mandatory templates that promote consistency of reporting and comparability across banks, and the need to allow senior management sufficient flexibility to provide commentary on a bank’s specific risk profile. For this reason, the revised disclosure regime introduces a “hierarchy” of disclosures. Prescriptive fixed form templates are used for quantitative information that is considered essential for the analysis of a bank’s regulatory capital requirements, and templates with a more flexible format are proposed for information which is considered meaningful to the market but not central to the analysis of a bank’s regulatory capital adequacy. Also, senior management may accompany the disclosure requirements in each template with a qualitative commentary that explains a bank’s particular circumstances and risk profile.
View Revised Pillar 3 requirements issued by the Basel Committee, 28 January 2015