The EACB welcomes the opportunity to comment on the European Banking Authority’s (EBA) draft ITS on supervisory reporting and draft ITS on Pillar 3 disclosure under the upcoming CRR 3.
We support the EBA’s approach for a two-step sequential process in amending the supervisory reporting and Pillar 3 disclosure obligations, prioritising those changes necessary to implement and monitor Basel III requirements in the EU.
We also appreciate the fact that the EBA has developed a comprehensive mapping tool to facilitate integration, consistency, and alignment between reporting and disclosure requirements. It is key that all Pillar 3 templates are always and only directly linked to Pillar 1 requirements.
Nonetheless, it should be clear that these ITSs will require massive efforts from the industry over the short timeline envisaged. Banks will need to focus on the newly introduced Basel elements as they have no prior experience with many of the data points or reference data available, and will be faced with managing a complex and ever changing framework under CRR3, as various elements will only become available after various iterations.
Finally, we urge the EBA to reconsider the obligation for banks to disclose the “fully loaded” risk-based capital ratio and the risk exposures amounts, taking into account not only the output floor’s phase in end-state, but also its impact excluding the EU transitional arrangements mechanisms. Such an approach would be counterproductive and conflict with the political objectives endorsed by EU co-legislators, in particular to ensure a smooth implementation and to consider in the medium term whether certain elements of the framework need permanent adjustments.