EBA欧洲银行-CP06revised2_Spanish-Bankers-Association_3页_88kb

CEBS Consultation Paper on Amendments to the Guidelines on Financial Reporting (FINREP) Summary

Core Content

The Spanish Bankers Association (AEB) has provided detailed comments on the CEBS consultation paper regarding proposed amendments to the Financial Reporting (FINREP) guidelines. The AEB supports initiatives that aim to reduce the regulatory reporting burden for credit institutions within the European Union. They align with the European Banking Federation (EBF) in advocating for harmonization of reporting requirements, reduction of redundant costs, and improvements in the reporting burden impact assessment.

Main Views and Key Suggestions

1. Reporting Frequency and Remittance Dates

• The AEB believes that requiring detailed breakdowns of interest income and expenses, as well as gains and losses on financial assets and liabilities held for trading, with higher frequency than annual will not significantly improve data quality but will increase processing costs.

• Recommendation: These details should remain as an annual requirement and be moved from core tables to non-core tables to reduce the regulatory burden.

• The AEB suggests that CEBS should establish a maximum reporting frequency, while allowing national supervisory authorities to require a lesser frequency (e.g., annual instead of half-yearly).

• Recommendation: For example, if CEBS proposes half-yearly reporting, national authorities should be allowed to require annual reporting, but not more frequent (e.g., monthly or quarterly).

• The AEB is particularly concerned about the frequency of credit risk valuation (tables 4 and 10), which should remain annual as per current IFRS standards.

• Recommendation: This data should not be required more frequently than annually.

2. Implementation Period for FINREP Changes

• The AEB notes that a tentative schedule has been proposed, with CEBS defining the reports, national authorities preparing the taxonomy in 2010, and financial institutions implementing changes in 2011, with new reports submitted in 2012.

• Recommendation: A 1-year implementation period should be guaranteed for the industry to make necessary changes, ensuring that entities are not forced to absorb delays from earlier stages.

• Special attention is needed for entities with a large number of subsidiaries, as the complexity of implementing changes across multiple entities can be significant.

• Recommendation: The implementation schedule should take this complexity into account.

3. Harmonisation of Sector Breakdowns

• The AEB advocates for harmonisation of sector breakdowns across the three sets of reporting: Statistics, FINREP, and COREP, for both individual and consolidated reports.
• Recommendation: If full harmonisation is not feasible due to different purposes of the data, the categories "Other Financial Corporations", "Non-Financial Corporates", and "Retail" should be combined under the same heading to simplify reporting and reduce costs.

4. Derivatives Reporting

• The AEB suggests that the promemoria item on "economic hedges" should be treated as a risk management requirement, not an accounting one, due to the complexity in determining whether a transaction is a hedge.
• Reasoning: The purpose of a derivative can change dynamically based on portfolio management, and internal models already cover this requirement.

5. XBRL Taxonomy

• The AEB fully supports the CEBS recommendation to use XBRL (eXtensible Business Reporting Language) for reporting.
• Recommendation: The taxonomy should be as simple as possible to avoid implementation issues, drawing on the accumulated experience of national supervisory authorities, such as the Bank of Spain, which has successfully reduced complexity in previous implementations.

Conclusion

The AEB emphasizes the importance of harmonization, simplification, and flexibility in the proposed amendments to the FINREP guidelines. They advocate for maintaining annual reporting requirements where appropriate, ensuring a reasonable implementation period, and leveraging national experience to simplify the XBRL taxonomy. These measures are intended to reduce the reporting burden without compromising the quality of data or the consistency of reporting across the EU.