EBA欧洲银行-CP06revised2_Febelfin_17页_903kb

Summary of Febelfin's Comments on CP06 Rev2 - Guidelines for Implementation of the Framework for Consolidated Financial Reporting

Core Content

Febelfin, representing four trade associations from the Belgian financial industry, provides detailed feedback on the revised FINREP guidelines (CP06 Rev2) with the goal of improving the implementation process and reducing reporting burdens. The comments emphasize the need for alignment between FINREP and IFRS, as well as the importance of harmonizing reporting practices across EU member states.

Main Views and Key Points

1. Approach to Reporting

• Febelfin supports Policy Option 1, the "Maximum Data Model," as a pragmatic solution that acknowledges differences in reporting culture among supervisors.
• Institutions should be able to rely on a single common data model, with the option to activate non-core tables on a country-by-country basis.
• National regulators must consider the interlink between reporting content, validation rules, and XBRL taxonomy to avoid inefficiencies and unnecessary administrative burden.

2. Reporting Burden and Uniformity

• While the reduction in quantitative data is welcomed, the introduction of new details (e.g., derivative classifications, interest income breakdowns) increases the complexity of implementation.
• The proposed remittance periods for FINREP are considered too short, especially for consolidated reporting, and would create bottlenecks in data collection and processing.
• Febelfin advocates for differentiating between core and non-core reporting when setting remittance dates, to avoid unnecessary time pressure.
• They believe that true uniformity in financial reporting can only be achieved if all national regulators adhere strictly to the FINREP framework without adding their own interpretations or data requirements.

3. Alignment with IFRS and IAS 1

• Febelfin stresses the importance of keeping FINREP aligned with IFRS, particularly with the IAS 1 framework, to avoid redundancy and potential obsolescence.
• They suggest that the CEBS workflow should be synchronized with the IASB's work on IAS 1 to ensure that FINREP remains relevant and compatible.
• The link between FINREP and IFRS-GP taxonomy is crucial for reducing reporting burdens and improving data consistency.

4. Qualitative Reporting

• Febelfin criticizes the lack of alignment between the qualitative reporting in FINREP and the annual reports of banks, which adds no value but increases the burden.
• They propose that qualitative data, such as narrative disclosures, should be included in the maximum data model if required by multiple supervisors, rather than being excluded unless necessary.

5. Mandatory Application of FINREP

• Febelfin supports mandatory application of FINREP at the consolidated level for all banks, but opposes its use for non-bank subsidiaries (e.g., investment firms, leasing companies).
• They believe that the mandatory application should be considered only after resolving tax-related issues and ensuring convergence between statistical and financial reporting.

6. IT and XBRL Integration

• Febelfin supports the CEBS initiative to promote IT best practices in cell definitions, especially in conjunction with XBRL.
• They emphasize the need for harmonization of codes and a clear mapping between the CRD counterparties and those used in FINREP.
• They also suggest that XBRL taxonomy should be developed in line with the IFRS-GP taxonomy to avoid duplication and ensure efficient data collection.

7. Specific Table Issues

• Accrued Interest and Interest Rate Margin: The current guidance suggests a "dirty price" approach, which requires banks to include accrued interest in each financial instrument. Febelfin believes this should be optional and not subject to national discretion.
• Counterparty Breakdown: The proposed "1 to n" mapping is not workable. They prefer a "1 to 1" or "n to 1" approach and suggest using the ECB's existing mapping work.
• Impairments: The term "incurred but not reported losses" should be changed to "collective impairment on collectively assessed financial assets" to align with IAS 39.

Conclusion

Febelfin calls for a more flexible and aligned reporting framework that takes into account the evolving IFRS standards, particularly IAS 1. They emphasize the importance of IT harmonization, XBRL integration, and national consistency in reporting. They also urge caution in reducing remittance periods and propose a differential approach based on the core vs. non-core data. The feedback underscores the need for a coordinated and sustainable implementation of the FINREP framework across the EU.