The EBA announced on the 2nd June 2020 guideline on “reporting and disclosure of exposures subject to measures applied in response to the COVID-19 crisis”
Published article can be found HERE.
Why: In response to the need to address negative economic consequences of COVID-19 pandemic, the European Union (EU) and Member States have introduced a wide range of mitigating measures to support the real economy and the financial sector. The EBA have created these new returns to track how far reaching these mitigating measures are in practice.
How: As a coordinated approach to the collection of information regarding the application of the payment moratoria to the existing loans and public guarantees to new lending in response to COVID-19 pandemic, the EBA is introducing additional reporting and disclosure covering both aspects. Competent authorities are expected to take all necessary supervisory measures to ensure that institutions report and disclose additional information as set out in these guidelines.
The guidelines are built on the existing definitions of Commission Implementing Regulation (EU) No 680/2014 (FINREP), and are subject to the application of the principle of proportionality and supervisory flexibility to tailor the application of the guidelines in way that is best suited for the particular situations in a given Member State.
The guidelines cover the following:
- reporting requirements to monitor the use of payment moratoria and the evolution of the credit quality of the exposures subject to such moratoria in accordance with the GL on moratoria
- disclosure requirements for the exposures subject to the payment moratoria in accordance with the GL on moratoria
- reporting requirements for the new loans subject to specific public guarantees set up to mitigate the effects of the COVID-19 crisis
- disclosure requirements for the new loans subject to the specific public guarantees set up to mitigate the effects of COVID-19 crisis
- reporting requirements on other forbearance measures applied in response to COVID-19 crisis.
When: Reporting should be performed on a quarterly basis, with the first reference date of 30 June 2020, and for an expected period of 18 months. Disclosure should be performed semi-annually on 30 June and 31 December.
To facilitate reporting on the basis of these guidelines, the EBA will provide technical package, covering validation rules, the data point model (DPM) and the XBRL taxonomy and will fully integrate the new reporting into the EBA reporting framework. Similarly, to the implementing technical standards (ITS) on reporting the XBRL taxonomy will not be mandatory for reporting institutions and will not be part of the guidelines. To facilitate that additional reporting, and reduce the costs for institutions and competent authorities, the EBA will also link the technical release of the new reporting requirements with the existing planned release (as a separate module in 2.10 phase 2). The EBA will publish the v2.10 Phase 2 release in June 2020.
VERMEG have begun analysis of these reports and will support these requirements for the banking community in our 2.10 phase 2 release of our regulatory reporting platform AgileREPORTER.
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