On May 12, 2016, the EBA published an Opinion on the European Commission's proposed amendments to the EBA's final draft ITS on benchmarking of internal approaches to regulatory capital. The Capital Requirements Directive sets out a framework for supervisory benchmarking of the internal approaches that EU firms use to calculate own-funds requirements for credit and market risk exposures. The final draft ITS, submitted by the EBA to the Commission in March 2015, include the benchmarking portfolios, templates, definitions and IT solutions for usage in that exercise. On April 16, 2016, the European Commission informed the EBA that it intended to adopt the final draft ITS with amendments. The Commission's proposed amendments are those agreed with the EBA following the 2014-2015 supervisory benchmarking exercise. In the Opinion, the EBA confirmed its agreement to the Commission's proposed amendments to the ITS and recommended that the benchmarking portfolios, detailed reporting templates and instructions should not be included in the ITS going forwards, because they will need to be updated annually prior to each supervisory benchmarking exercise. The EBA proposes that it should be given new powers to update the benchmarking portfolios, detailed reporting templates and instructions, so that the updates can be done more quickly and allowing firms more time to prepare for the annual exercise.
The EBA's Opinion is available at: http://www.eba.europa.eu/documents/10180/1461618/EBA-Op-2016-09+EBA+Opinion+on+Commission+amendments+to+ITS+on+benchmarking+of+internal+approaches.pdf and the EBA's letter to the Commission is available at: http://www.eba.europa.eu/documents/10180/1461618/%28EBA+2016+D+698%29%20 Letter+to+O.+Guersent%2C%20DG+FISMA%2C%20EBA+Opinion+on+ITS+on+Benchmarking.pdf .
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
