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FSA to implement CoREP

This document looks at the FSA’s implementation of the European Banking (EBA’s) COREP - May 2011

Introduction

In 2006 The Committee of European Banking Supervision introduced the discretionery Capital Requirements Directive (CRD) reporting standard COREP. The aim was to create a common reporting framework for the EU.

Since then, CEBS became the European Banking (EBA) in January 2011 and now acts as the central networking point for EU and national bodies to safeguard the stability of the financial services industry and the public with transparency in the markets and financial products along with putting proceedures in place to protect depositors and investors.

To follow this, the EBA will now require all UK firms regulated under the Capital Requirements Directive (CRD) to comply with COREP from 31st December 2012.

Requirements and objectives

The FSA are to implement requirements set by the EU Commission. Through the EBA the EU commission will require all UK firms regulated under the Capital Requirements Directive (CRD) to comply with COREP from 31st December 2012. What this means is that all firms that are affected by the introduction of COREP must be ready to start reporting by 31st December 2012.

By mandating COREP for all CRD firms the EBA aims to:

Reduce the impact of multiple regular reporting obligations to the different supervisors in Europe by standardising European reporting requirements
Improve risk identification and management in firms with multi-country reporting obligations by establishing a central repository dedicated to European banking data
Determine greater transparency and risk analysis again with the multi-country firms in mind by facilitating peer groups and predicting trends
Share data easily with national and international authorities and supervisory colleges

The FSA is anticipating that after 2013 there will be a need to provide harmonised reporting formats using XBRL taxonomies and that the FSA will be required to transfer COREP data submitted by firms to the EBA in an XBRL format. With that in mind there will need to be development of an XBRL data collection channel within GABRIEL

It is highly likely that the existing COREP reports will be replacing or indeed be incremental to existing reports and that they will have to be completed in XBRL rather than the current method of XML, the alternative would be to run it along side.

Either way there will be increased demands and therefore these requirements will have in impact on resources and systems because firms will have to take on the new suite of reports, understand them, test them and be happy that the systems and implementation is complete and competent before they submission.

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