EBA欧洲银行-CP06revised2_Erste-Group-Bank-AG_13页_197kb

Erste Group Bank AG Summary of Comments on Revised FINREP Guidelines

Core Content

Erste Group Bank AG has provided detailed feedback on the revised FINREP (Financial Reporting) Guidelines proposed by the Committee of European Banking Supervisors (CEBS). The comments focus on the potential impact of the revised framework on reporting burden, uniformity, and compliance with IFRS standards. The bank acknowledges the intention to harmonize financial reporting across the EU but raises concerns about the practicality and compliance of certain requirements.

Main Views and Key Points

1. Reporting Burden and System Changes

• The revised FINREP reduces some reporting burden by eliminating national discretions, but introduces new data requirements that are not currently available in existing systems.
• Many of the new tables (e.g., Table 15A, 26, 14, etc.) require detailed breakdowns (counterparty, geographical, or product-based) that would necessitate significant system modifications.
• The bank emphasizes that the removal of national discretions does not automatically reduce the overall reporting burden, as new information may require substantial effort and resources.

2. Uniformity of Financial Reporting in the EU

• Erste Group supports the CEBS' Option 1 "Maximum data model" for harmonization, but notes that the actual uniformity will depend on the templates adopted by national supervisors.
• They highlight the need for clarity and alignment with IFRS to ensure that the reporting requirements are both practical and compliant.

3. Link Between FINREP and IFRS-GP Taxonomy

• The bank expects a link between the FINREP framework and the IFRS-GP (General Purpose) taxonomy, as this would enhance consistency and data usability.

4. Reporting Frequencies and Deadlines

• Erste Group agrees with the proposed reporting deadlines by CEBS.

5. Versioning Policy

• The bank supports the "Maximum data model" as a complement to XBRL-related issues, and believes that further clarification is needed on the versioning policy.

6. Impact on Reporting Procedures

• The bank is concerned that the new information required, such as counterparty breakdowns and detailed derivative reporting, may not be feasible without significant changes to existing systems.

7. Availability of New Information

• Several tables in the revised FINREP require information that is not currently available or not fully aligned with IFRS, including:
  • Table 3: Economic hedges derivatives
  • Table 3, 8: Split of notional amount of non-option derivatives according to fair value
  • Table 4: Debt securities
  • Table 5 A, B, C: Counterparty breakdown of financial assets
  • Table 5 D: Geographical breakdown of financial assets
  • Table 6: Loan type breakdown
  • Table 7: Impaired and past due assets breakdown
  • Table 10 A, C: Financial liabilities breakdown
  • Table 11: Financial assets entirely derecognised
  • Table 14: Too detailed breakdown
  • Table 15 A: Counterparty breakdown of interest income and expenses
  • Table 15 B: Gains and losses from hedge accounting (new for some subsidiaries)
  • Table 16 B: Allowances movements by counterparty
  • Table 20: Counterparty breakdown
  • Table 24: Not available
  • Table 25: FV hierarchy for financial assets and liabilities not measured at FV

8. Clarity and IFRS Compliance Concerns

• The bank requests clarification on several aspects, including:
  • The definition of "retail exposures" in the guidelines
  • The treatment of interest income and expenses on derivatives
  • The correct application of IFRS 7.9 and IAS 39 for financial assets and liabilities
  • The classification of certain line items in the consolidated balance sheet and income statement
  • The use of "gains and losses" terminology in the context of interest items
  • The reporting of provisions and employee benefits
  • The fair value hierarchy for financial instruments not measured at FV
  • The treatment of hybrid financial instruments

Key Recommendations

• Clarification on terminology and definitions is needed to ensure alignment with IFRS and avoid misinterpretation.
• Avoiding redundant or impractical reporting items is crucial to reduce burden on banks.
• Mandatory application of FINREP at the consolidated level should be considered only if it is the sole source of consolidated reporting for national supervisors.
• Extending FINREP to solo level should be done only if IFRS is the statutory accounting framework for all subsidiaries.
• System changes will be necessary to comply with the new reporting requirements, especially for detailed counterparty and geographical breakdowns.

Additional Notes

• The bank has placed specific comments in an Appendix of the letter, which includes detailed explanations and recommendations for each table and section.
• The bank appreciates the effort of CEBS to harmonize reporting standards and is open to collaboration on the work plan, but highlights that further adjustments may be needed after the IASB's new standards on financial instruments are issued.