EBA欧洲银行-AR2007_69页_1mb

Annual Report 2007 Summary

Core Content

The Annual Report 2007 of the Committee of European Banking Supervisors (CEBS) outlines the key activities and progress made by the Committee in promoting supervisory convergence, enhancing cooperation, and addressing financial market turmoil. The report is submitted to the European Commission, Council, and Parliament, in accordance with the legal framework established by the Commission Decision 2004/5/EC and the CEBS Charter.

Main Viewpoints

1. CEBS's Evolving Role

• CEBS has expanded its focus beyond developing regulatory guidance to providing practical advice on the implementation of the Capital Requirements Directive (CRD).
• The Committee has taken on new responsibilities in response to global financial turmoil, particularly the US subprime mortgage crisis.
• CEBS has developed tools and frameworks to support the convergence of supervisory practices across the European Union (EU), ensuring consistency and transparency in the application of EU banking regulations.

2. Addressing Market Turmoil

• CEBS intensified prudential supervision and increased cross-border cooperation.
• The Committee held ad hoc meetings and conference calls to exchange information and conduct joint assessments of the situation in EU markets.
• The subprime crisis served as a real-world stress test for CEBS, highlighting the need for stronger liquidity risk management, transparency in securitisation and structured products, and better valuation practices for illiquid instruments.

3. Convergence in Supervisory Practices

• CEBS introduced new outputs such as surveys, convergence networks, and workshops to promote consistent supervisory practices.
• The Committee has focused on improving the transparency and comparability of supervisory disclosures across Member States.
• The supervisory disclosure framework was launched to provide insights into the implementation of CRD provisions and CEBS guidelines in each EU country.

Key Information

1.1 From Design to Delivery

• CEBS shifted from developing regulatory standards to delivering practical supervisory convergence.
• The Committee introduced new tools like the electronic guidebook, which consolidates CEBS guidelines related to the CRD.
• Convergence Networks were established to foster continuous dialogue and ensure consistent responses to technical supervisory questions.

1.2 Market Turmoil

• The subprime mortgage crisis significantly impacted CEBS's activities and highlighted the need for improved liquidity risk management and transparency.
• CEBS identified four main areas of concern for supervisors:
  1. Liquidity conditions and risk management
  2. Transparency in securitisation and structured products
  3. Valuation of complex illiquid instruments
  4. Cross-border financial management
• The Committee worked with banks and auditors to improve internal governance and stress testing processes.

1.3 The Lamfalussy Review

• CEBS contributed to the Lamfalussy Review, which aimed to improve regulatory and supervisory convergence in the EU.
• The review led to several concrete proposals:
  • Phasing out options and national discretions in Community legislation, with sunset clauses for those that remain.
  • Implementing the Lamfalussy structure in banking legislation to enhance regulatory clarity and reduce fragmentation.
  • Developing own initiative advice to identify areas where regulatory convergence is lacking.
  • Enhancing supervisory cooperation and creating common reporting frameworks.

Achievements in 2007

2.1 Advice to the Commission

• CEBS provided technical advice on several key topics:
  • Definition of own funds
  • Large exposures
  • Liquidity risk management
  • Commodities business
  • Equivalence of supervisory arrangements in Switzerland and the United States
  • Options and national discretions in the CRD

2.2 Convergence in Supervisory Practices

• CEBS worked on implementation of FSC recommendations.
• Introduced supervisory disclosure frameworks and Pillar 2 work.
• Developed frameworks for supervisory reporting and supported Pillar 3 initiatives.
• Introduced prudential filters and coordinated with the CRD Transposition Group.

2.3 Accounting and Auditing

• CEBS focused on improving valuation standards for complex illiquid instruments.
• The Committee emphasized the need for robust internal controls, governance mechanisms, and disclosure practices.
• CEBS collaborated with accounting and auditing standard-setters to ensure consistency and transparency in valuations.

2.4 Cooperation

• CEBS enhanced operational networking and supervisory colleges.
• Promoted cooperation with third countries and improved crisis management frameworks.
• Strengthened dialogue with market participants and formed industry expert groups to provide feedback on CEBS's work.

2.5 Cross Sectoral Convergence

• CEBS worked with other Level 3 Committees (CEIOPS and CESR) to promote common solutions and streamlined processes.
• Supported 3L3 training and supervisory culture development.
• Developed medium-term work plans and aligned work priorities with EU institutions.

Process and Institutional Development

3.1 Operational Structure

• CEBS established expert groups and task forces in 2007.
• Task forces were created to address specific supervisory challenges.
• CEBS maintained 3L3 structures and engaged with Bureau Members and the Secretariat.

3.2 Consultation and Dialogue

• CEBS engaged in consultative dialogue with stakeholders, including the Consultative Panel.
• The Consultative Panel played a key role in analyzing market events and drawing lessons from the crisis.
• CEBS sought early input from industry experts to improve the practical relevance of its guidance.

3.3 Accountability

• CEBS emphasized the need for structural improvements in three areas:
  1. A clearer institutional framework and accountability mechanisms.
  2. Enhanced cooperation between Level 3 Committees.
  3. Increased dialogue with market participants and end-users of financial services.

Annexes

• Annex 4.1 outlines the Commission Decision 2004/5/EC establishing CEBS.
• Annex 4.2 details the Charter of the Committee.
• Annex 4.3 provides information on CEBS members and observers.
• Annex 4.4 discusses consultation and transparency on guidelines.
• Annex 4.5 includes the Annual Report and Financial Statement of the CEBS Secretariat.
• Annex 4.6 outlines the accomplished timeline for 2007.
• Annex 4.7 lists abbreviations and terms used in the report.

Conclusion

The Annual Report 2007 highlights CEBS's active role in promoting supervisory convergence, enhancing cooperation, and responding to financial market challenges. The Committee has made significant progress in developing practical tools and frameworks, but acknowledges that further improvements are needed to ensure consistent and effective implementation of EU banking regulations. CEBS continues to work closely with EU institutions, the financial industry, and international bodies such as the Basel Committee to strengthen the EU's financial supervisory framework.