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EBA tightens data reporting guidelines for COVID-19 measures

June 2, 2020. Print article

The is imposing additional reporting requirements for lending measures undertaken in response to the coronavirus pandemic, according to a new set ofguidelines released Tuesday. 

The organization said that adequate information must be available to monitor and assess risks associated with institutions’ activities, as well as to strengthen transparency and market discipline amid COVID-19.

EBA notes that EU banking authorities have introduced measures in recent months to mitigate the economic effects of the pandemic and related shutdowns. Some countries have introduced "legislative moratoria" on loan repayments, giving them a payment holiday on existing loans. Others are offering various forms of public guarantees to be applied to new lending.

But with a lack of coordination across the EU, EBA believes these measures are sporadically creating data gaps in supervisory reporting and disclosure. 

"Whilst the measures are designed to ensure support for EU citizens and business during the crisis, regulators and supervisory authorities still have a responsibility to ensure that information is available to monitor and understand any risks associated with banks’ activities," EBA said. 

The new guidelines cover reporting and disclosure requirements to monitor the use of payment moratoria, reporting and disclosure requirements for the new loans subject to specific public guarantees set up to mitigate the effects of COVID-19 and reporting requirements on other forbearance measures applied in response to COVID-19.

Later this month, EBA will publish validation rules that will detail what data is required and facilitate proper data collection and transmission. The new guidelines will apply across the EU proportionally in regard to institution type, size, nature and scope, as well as the complexity of their activities and risk profile. 

According to the EBA, credit institutions should be reporting exposures that are subject to payment moratoria and forbearance measures that have been introduced due to COVID-19. They should also report newly originated exposures subject to public guarantee schemes that EU countries have introduced due to COVID-19.

"To ensure efficiency, a coordinated EU approach in the collection of additional information is needed. That is why the EBA is introducing, on a temporary basis, additional reporting for the application of the payment moratoria, forbearance measures applied in response to COVID-19 to the existing loans and public guarantees to new lending in response to the COVID-19 pandemic," EBA said.

The first reporting and disclosure reference date will be June 30, 2020. Reporting will be performed on a quarterly basis for an expected period of 18 months, while disclosure will be performed semi-annually.