EBA欧洲银行-EBA-2014-0005-0000-SK_17页_371kb

Summary of EBA Recommendations on Asset Quality Assessment

Core Content

The European Banking Authority (EBA) has issued recommendations aimed at enhancing the uniformity and effectiveness of asset quality assessments (AQA) across European Union (EU) member states. These recommendations are directed at national competent authorities (NCAs) and are intended to support the proper evaluation of credit portfolios, including classification and reserve creation, to ensure adequate capital and capital reserves are in place to cover risks associated with these exposures.

The primary goal of these recommendations is to promote a consistent approach to AQA, reduce uncertainties regarding asset quality, and facilitate the implementation of the Single Supervisory Mechanism (SSM) and other supervisory frameworks. They also provide a framework for the assessment of asset quality in banks not subject to the SSM, and encourage coordination among supervisory bodies to address potential weaknesses in the financial sector.

Main Recommendations

1. Asset Quality Assessment Scope and Objectives

• NCAs are required to assess the quality of assets in credit portfolios, particularly those considered high-risk.
• The assessment should be shared with supervisory colleges and ensure proper evaluation of each bank's risk portfolio.
• These recommendations support the implementation of existing and planned work on asset quality assessment and do not restrict the Single Supervisory Mechanism or other supervisory approaches.

2. Use of EBA-Recognized Procedures

• NCAs should use the EBA-recognized procedures listed in Appendix II when conducting AQA.
• These procedures are not mandatory for all asset classes but are considered relevant for high-priority asset classes and exposures.

3. Communication and Reporting

• NCAs must report to the EBA whether they have implemented the recommendations or intend to do so by 23 December 2013.
• Reports should include details on the implementation process, including any steps taken and the significance of the results.
• Reports must be submitted to compliance@eba.europa.eu in the format specified in Section 5, marked as “EBA/Rec/2013/XX”.

4. Timeline and Implementation

• NCAs are required to complete the asset quality assessment by 31 October 2014.
• Preliminary results should be communicated to the EBA as soon as possible to support the European-wide stress test.
• The EBA encourages the development of a communication policy for the results of the asset quality assessment, especially for the SSM.

Key Information

1. List of Competent Authorities

• The following table lists the competent authorities in each EU member state:

2. Recommended Procedures

• NCAs should focus on identifying high-risk asset classes and exposures.
• They should conduct both quantitative and qualitative analysis of the selected asset classes and exposures.
• The analysis should consider the significance and risk of the asset classes, including:
  • Value of exposures
  • Maturity
  • Collateralization
  • Reserve creation
  • Macroeconomic conditions
  • Internal and external risk evaluation
  • Effectiveness of credit controls

3. Risk Classification and Reserve Creation

• NCAs should assess whether the risk classification and reserve creation levels are consistent with the quality of assets in the portfolios.
• They should evaluate the parameters used for calculating general provisions and risk coverage, ensuring they are validated and appropriate.
• Special attention should be given to the treatment of non-performing loans and restructured loans.

4. Monitoring and Management of Collateral

• NCAs should evaluate how credit institutions assess, manage, and monitor collateral.
• This includes assessing the allocation of responsibilities for collateral evaluation and ensuring independence from credit granting.
• They should also review the frequency and validity of collateral valuations and their relation to reserve creation.

5. Reporting Requirements

• Reports must include information on:
  • Basic information about the banks in the sample
  • Risk classification of credit portfolios
  • Loan deferrals and non-performing loans
  • Non-payment events and corrective actions
  • Levels of risk coverage and reserve creation and their objectives
• A scoring system may be used for qualitative reporting, as determined by the competent authorities.

Conclusion

The EBA recommendations aim to ensure a harmonized and effective approach to asset quality assessment across the EU. They emphasize the importance of transparency, consistency, and coordination among supervisory bodies. By promoting a common framework, the EBA seeks to enhance the reliability of asset quality evaluations and support the stability of the European banking system.