1. Jean-Michel DELAVAL 19 November 2009
NEW FINREP
Jean-Michel DELAVAL
19 November 2009

2. ) Maximum Data Model and Revised FINREP
Outline
) FINREP Guidelines
) Maximum Data Model and Revised FINREP
) Templates
4) IT issues
5) Next steps

3. Current FINREP
In 2005, European Commission endorsed the IAS/IFRS and created an unique opportunity to increase comparability of information produced by credit institutions for their respective national supervisory authorities
Therefore, the FINREP was based on IAS/IFRS and was created with the aim to standardise information received by supervisors across Europe.

4. 1) Current FINREP
In October 2007, CEBS published an assessment on convergence regarding supervisory reporting
Almost full convergence on core templates but less convergence on non-core templates
Notwithstanding these initial achievements, CEBS recognised that more work is needed

5. 1) FINREP Guidelines revised
Aims of the amendment:
1 – streamline financial reporting
2 – improve convergence and harmonization in EU

6. 2) FINREP Guidelines revised
Main “policy” changes
Maximum data model : the revised Guidelines explicitly sets minimum and maximum reporting requirements based on a common set of data definitions
No national discretions allowed under Finrep framework
Drop most of the options (e.g. information that could be required throughout the framework)
Keep the strong link with IFRSs including additional information only if strictly necessary for supervisory assessment of banks

7. 2) Maximum Data Model
This Maximum Data Model has been achieved after intensive work of revision of current templates and after appropriate assessment of additional information collected at national level using the option provided in the current Guidelines
Main advantage for cross border groups: it should be crystal clear what is the maximum IFRSs based reporting requirement throughout Europe

8. Consolidated Balance Sheet (or Statement of Financial Position)
2) Templates
Core information
Consolidated Balance Sheet (or Statement of Financial Position)
Assets
Liabilities
Equity
Consolidate Income Statement (so called Separate Income Statement according to IAS 1, par. 81 (b))

9. 2) Templates
Non-core information (notes and other templates)
These templates are a breakdown of items already included in the core information and take into account also what is defined in IAS 1, paragraph 10 as a “complete set of financial statements” (e.g. table 21 “Statement of comprehensive income” and table 22 “Statement of changes in equity”).

10. 2) FINREP Guidelines revised
Reporting dates:
Quarterly
Semi-annually
Annually
31 March
30 June
30 September
31 December
Frequency:
Corridor between 20 and 40 business days
Option to collect audited data referred to 31 December (annual reporting) depending on the national legislation implementing the Transparency Directive (related to the publication of audited year-end results)

11. 2) Maximum Data Model
Scope of Finrep framework
Reporting at consolidated and subconsolidated level
Not solo reporting, but Member States are free to implement Finrep at solo level too
Pillar 2 templates (for instance liquidity risk, country risk, interest rate risk)
Statistical reporting to European Central Bank, International Monetary Fund or Bank of International Settlements

12. 3) Templates Core information: main changes Assets Liabilities
new concept of “cash” instead of “cash and cash balances with central banks”
counterparty breakdown (revised) only in template 5
details of equity instruments available only in non-core
Revised for IFRS scope (insurance activities)
Liabilities
drop of “deposits from central banks”; included under relevant portfolio
new counterparty breakdown (consistent with asset side)
drop of “liabilities associated with transferred financial assets”; included under relevant portfolio

13. Core information: main changes Equity
3) Templates
Core information: main changes
Equity
addition of items related to investments accounted for using the equity method
Income Statement
Limited changes for consistency with Balance Sheet changes

14. Non-core information: main changes Financial instruments disclosure
3) Templates
Non-core information: main changes
Financial instruments disclosure
revised breakdown on derivatives
revised counterparty breakdown for financial assets and financial liabilities
introduction:
geographical breakdown
breakdown of loans and advances
breakdown of interest income and expenses by product and counterparty
hierarchy of fair value and prudential data
Asset management

15. Non-core information: main changes Other templates
streamlined:
property, plant and equipment and investment property
related party disclosure
defined benefit plans
statement of changes in equity (former “analysis of equity”)
gains and losses from hedge accounting
other operating income and expenses

16. Non-core information: main changes Other templates
dropped:
non current assets and disposal groups classified as held for sale
staff expenses and general and administrative expenses
reconciliation of statutory tax to effective tax
profit or loss after tax from discontinued operations
information on leasing
cash flow statement

17. 4) IT issue
CEBS still recommends the use of XBRL for reporting purpose
It will develop the revised version of Finrep XBRL taxonomy taking into account adequate link with IFRS GP Taxonomy
The adoption of XBRL taxonomy will probably lead to greater harmonisation of IT formats
The revised Finrep XBRL taxonomy will be based on the same concepts used in the Corep taxonomy

18. 5) Next steps
A) In 2009 and 2010, revisions of IAS 39 in three phases :
Classification and measurement in 2009
Impairments in 2010
Hedge accounting in 2010
When new IFRS are endorsed by EU commission, a dedicated task force will be created to change the FINREP in 2010
B) Main target remains to implement the new FINREP in 2012

19. Now it is your time ! Thank you!19