Page 62 - EBA 2015.1815 Annual report 2014 web 2

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E U R O P E A N B A N K I N G A U T H O R I T Y
60
Assessing risks and
ensuring transparency in
the EU banking sector
The EBA is mandated to monitor and assess
market developments, as well as to iden-
tify trends, potential risks and vulnerabilities
across the EU banking system and is uniquely
placed to do so. In 2014, the EBA’s risk assess-
ment infrastructure was further strengthened
with significant developments in the following
areas:
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The EBA as a central EU data hub; the roll
out of the new reporting standards strength-
ened the EBA’s role as the EU data hub for
supervisors and market participants.
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The EBA’s own risk infrastructure; har-
nessing the new reporting requirements to
improve its key risk indicators and suite of
regular risk products; undertaking thematic
work on RWA consistency; and coordinating
the Union wide assessment of the largest
EU banks in the form of a stress test.
In addition, the EBA carries out macro-pruden-
tial work and activity around shadow banking.
The EBA as a data hub
The EBA developed and rolled out, for the first
time, a single set of supervisory reporting
standards in the form of Common Reporting
Requirements (COREP) and Financial Report-
ing Requirements (FINREP). It has worked to
improve the quality assurance process and data
sharing within the EU as these standards have
significant benefits for many users including:
1. Efficiency for banks operating in the Sin-
gle Market with a single set of supervisory
reporting standards designed to avoid du-
plication and differing reporting require-
ments, and comprehensive enough to
minimise ad hoc data collections.
2. Bank monitoring tools for supervisors who
receive consistent data across the single
market to monitor Pillar 1 requirements
and assess risks under Pillar 2.
3. System monitoring tools for supervisory
authorities, the EBA and the ESRB, with
consistent data across the single market
facilitating effective peer analysis and im-
proving system wide analysis.
4. The EBA uses the reporting data to provide
aggregate information to market partici-
pants.
For the first time, the reporting standards pro-
vide fully harmonised information on banks’
own funds (COREP) and balance sheet data
(FINREP). To support uniform implementa-
tion and increase efficiencies, the EBA has
developed Data Point Models and taxonomies
and has worked to improve quality assurance
process via common validation rules, worked
with competent Authorities to minimise the
challenges in transmitting data and to find
versioning solutions to enable consistent time
series.
In addition to the data collection, during 2014
the EBA was also active in promoting the har-
monized reporting standards in other data
reporting frameworks. Together with the
ECB, the EBA conducted a review of the Con-
solidated Banking Data framework in order to
align it with the harmonised ITS on supervi-
sory reporting and to benefit from harmonised
and richer data available to EU supervisors.
Consolidated Banking Data, published by the
ECB, covers aggregated data of each EU bank-
ing system based on supervisory data.