Category: CRD IV

Are you prepared for the implications of the new CRD IV regulations?

Posted on by Julie Duncan

ALMIS® International can provide you with a comprehensive solution to meet the demands of regulatory reporting for COREP and FINREP.

 

ALMIS® International provides a full CRD IV submission system, with the option to calculate reports directly from a firm’s balance sheet. Our system can provide a complete solution to all the requirements of CRD IV and has the flexibility to deliver on specific elements that your organisation requires.

 

The ALMIS® Regulatory Reporting Module provides a fast and flexible method of completing COREP and FINREP reporting, offering both full automatic calculation and spreadsheet integration.

 

Users of the regulatory reporting module have two options:

 

1. Input only option – transforms data held from spreadsheets into XBRL.

2. A full calculation option – produces the reports directly from your source systems.

 

The ALMIS® system has been comprehensively developed and extensively tested, making it a reliable, effective and time saving solution to reporting. ALMIS® is supported by a team of ALM experts and software engineers and is updated to ensure it meets all regulatory changes.

 

The benefits of using the ALMIS® system for regulatory reporting include:

 

  • Reduced pressure on finance department through seamless automation of regulatory returns which are consistent across regulation and ALCO reporting

  • PRA Reporting through XML to the PRA/FCA’s Gabriel System

  • COREP Reporting through XBRL to the PRA/FCA’s Gabriel System

  • Bank of England Reporting using XML to the Bank of England’s OSCA system

  • Easy to use with Audit trails

  • Full validation as is done on the Regulatory Systems, including cross validation between the reports

  • Automatic calculation on totals and listing of calculations on cells

  • Segregation of Editing, Reviewing and Submission roles

 

Our team of ALM experts, software engineers and system integrators understand the changing regulatory landscape and provide a flexible, forward-looking system that enables you to achieve regulatory compliance with minimum disruption to your business.

 

With over 50 banking clients and over 60% of the UK Building Society market, ALMIS® International are a UK market leader for regulatory reporting systems for UK banking firms.

 

For more information on how the ALMIS® solution can work for you, contact Cecilia Mueller on 0131 4528898 or email [email protected]

Updates to the Capital Requirements Directive (CRD) IV

Posted on by Julie Duncan

Our review of the implications

The banking sector is bracing for significant change to regulatory reporting. The European Banking Authority (EBA) has released the ‘Final Draft’ technical standards for COREP and FINREP. This relates directly to the Capital Requirements Regulation released in June this year and contains the templates and validation for CRD IV reporting. This draft has a 3 month consultation period for proposed amendments.

Changes to submission dates

There have been alterations to the dates of the first submissions. Whilst many reports suggested the first submission date would be 30 business days from the 31st of March, the technical standards produced for the EBA state that the monthly reports should be completed 30 calendar days after the 31st. These changes only apply to the first submission. For all monthly reporting after the first submission, a 15 calendar day period will apply.

SME Support – a positive change to help both lenders and SMEs

A reduction in the capital held to cover exposures to small and medium sized enterprises (SMEs) is also implemented in this latest update from the EBA. This is not a change to risk weight but instead a new factor in the calculation of capital holding. This “SME supporting factor” is designed to boost lending to SMEs; therefore any capital gained should ideally be used to lend more to the sector. This change was led by Germany but will have impact across Europe.

The purpose of this change is to remove the impact of the capital conservation buffer for SMEs. The minimum capital requirement is calculated as 8% of the Risk Weighted Exposure (RWE) and the Capital Conservation Buffer is 2.5% of RWE. This means that combined a total of 10.5% is held. The factor is 0.7619 which is equal to 8/10.5. This means in practice, instead of holding 10.5% in total, there is effectively a total of 8% held for SME lending.

ALMIS® caters for this change in its latest release, enabling clients to take full advantage of this change and minimise their capital holding requirements.

Large Exposures

Large Exposures reporting is supplemented with an expected maturity breakdown for any exposures to the counterparty. This means that for large exposures including retail lending there can be a significant volume of calculation to produce the new LE4 and LE5 reports. ALMIS® International are prepared for this change, and ALMIS® already has a maturity analysis tool which clients are successfully using to assist with reporting.

The PRA Response

The Prudential Regulation Authority has released consultations on these new items. It is expected that the PRA will enforce 100% Risk Weighting on Commercial Mortgages and 35% for Buy to Let Mortgages if less than 80% Loan to Value.

In terms of Capital the PRA has voiced the intention for a firm specific capital buffer in addition to the combined CRD IV Buffer constituted of CET1 capital. The impact depends on the proportionality that the PRA impose.

Working to a Solution

These changes to capital calculations and levels of reporting increase the burden of compliance and reporting for banks and building societies. Firms need to understand the impact of these regulations before the implementation date of 1st January 2014.

ALMIS® International provides a full CRD IV submission system, with the option to calculate the reports directly from a firm’s balance sheet. We have a dedicated team of staff working to stay up to date with the changing regulations and to help firms meet their regulatory compliance requirements.

For more information on how the ALMIS® solution can work for you email us or call on 0131 452 8898.

CRD IV – Final Draft Templates Released

Posted on by Julie Duncan

On the 26th July the European Banking Authority released the ‘final draft’ set of templates and validations for CRD IV. This relates directly to the newest and final definition of the CRR which was released in June.

COREP has a number of significantly changed templates from the previous release. The Credit Risk reports now show more detail on the reporting of Small and Medium sized Enterprises (SME) while the Large Exposures reporting now shows an expected maturity profile breakdown as well as reporting the Counterparty information in a new template.

At ALMIS® International we are in the process of updating the internal version of the Data Point Model within the Regulatory Reporting Module. Once this is complete we will release an updated version of the module to all clients. This will include the automatic calculation of reports from the Capital Adequacy Module, and allow population of the new templates.

Please note that while this is the final draft there is a period of 3 months in which changes could be made. Additionally the updated taxonomies which allow correct XBRL generation have not been released yet, these are expected at the end of August. The first submission of COREP will be in April 2014. Firms should be prepared to submit the full XBRL submission at this time.

A Q&A tool is also now available on the EBA website and this should help us all interpret the new requirements.

If you have any questions on ALMIS® and the CRD IV Reporting regime please contact Virginia Hay or Georgina Macleod.

Further delays to CRD IV (COREP)

Posted on by Julie Duncan

Rumours have been circulating in recent months about further delays to COREP; the FSA have today issued a revised statement on the expected CRD IV and CRR implementation, claiming it is continuing work on implementing the directive and expects firms to do the same.

In response to further deferrals in the negotiation timetable, the FSA have put back implementation of COREP a further six months claiming it will start collecting data for the period beginning 1 January 2014, should the legislation and related standards be in force by that date.

The FSA set out their intended approach to capital transition in a statement in October 2012. Once finalised legislative text is available at the EU level the FSA intends to publicly consult on changes to FSA rules.

ALMIS® International will work with clients to meet the new rules and are holding a seminar with the FSA (soon to be PRA) in London on 10th April 2013 to discuss the practical implications – already over 20 banking firms have signed up to attend this event. This will discuss developments in bank liquidity and capital regulations & practices; it will provide an overview of the latest developments in bank regulations and practices with a particular emphasis on CRD IV and the impact of BASEL III.

For more information on the ALMIS® International Seminar “Developments in Bank Liquidity and Capital Regulations” click here.

Source: FSA

European Commission admits delay to CRD IV Reporting Regime

Posted on by Julie Duncan

During a 4 day conference in Frankfurt which is currently underway the European Commission finally announced that the adoption of the CRD IV package will be subject to delay. This is no news to those who have been following the status of the implementation of the new regulatory regime but the regulatory bodies appear now to have aligned on the subject of when Common Reporting will be expected to be implemented.

 

The FSA announced on the 1st August 2012 that they would be making the necessary preparations to begin collecting data under Common Reporting for the period beginning 1st July 2013, subject to the legislation and related standards being finalised by this date.

 

Although this may be the case at the moment, the European banking industry are recommending a 12 month delay from the original implementation date of 1st January 2013.

A revised timetable is not yet available but firms should prepare to work towards ensuring they have the capabilities for COREP in place by 1st July 2013 as per the current estimated date provided by the EBA and FSA.

 

Further information released during this conference includes details on additional technical aspects of CRD IV Reporting.

ALMIS® will provide further updates as and when any further information is made available.

 

ALMIS® Regulatory Reporting Module: CRD IV Reporting Capability

Posted on by Julie Duncan

In response to the changes in regulatory reporting, ALMIS® International is pleased to announce the update to the current Regulatory Reporting module which includes CRD IV (COREP/FINREP) reporting.

The CRD IV consists of the Capital Requirements Directive (CRD), the Capital Requirements Regulation (CRR) and also reflects the Basel III capital proposals. The European wide regulation also includes new regulatory reporting requirements; Common Reporting (COREP) and Financial Reporting (FINREP), these reports will be required to be submitted in XBRL format.

The changes were initially due to be implemented from 1 January 2013 but have now been delayed. In accordance with the FSA statement released 1st August 2012 banks will now be expected to have the capability to submit these reports to the FSA from 1st July 2013.

This latest update to the regulatory reporting module strengthens ALMIS® International’s commitment to ensuring that the ALMIS® system is future proof and offers firms who are not currently using this module, a quick, easy and cost effective solution to this new regulation.

To view more information on the update to the ALMIS® Regulatory Reporting Module, click here.

If you require any more information on ALMIS® International or the update to the Regulatory Reporting Module, please do not hesitate in contacting us on [email protected]

ALMIS® offers COREP / FINREP (CRD IV) capability

Posted on by Julie Duncan

ALMIS® International announces today that they are releasing COREP / FINREP (CRD IV) capability into their regulatory reporting module.

Next year, Banks and Building Societies across Europe will have no choice but to submit returns automatically using XBRL and this could result in significant system developmments. ALMIS® software can provide the capability to both produce and submit COREP/FINREP XBRL documents.

This latest update to our regularory reporting module strengthens our commitment to ensuring ALMIS® is future proof, and offers Firms who are not currently using this module, a quick, easy and cost effective solution to this new regulation.

For further information please contact our dedicated team at [email protected]