Accommodating 2021 Pillar III Disclosure Requirements – Plugging In A Solution Can Be As Seamless As Changing A Zoom Background

In June 2020, the European Banking Authority (EBA) published new Implementing Technical Standards (ITS) on public disclosures by institutions and a revised final ITS on supervisory reporting. Both developments mean that institutions must immediately implement the changes introduced in the Capital Requirements Regulation 2 (CRR2) and the prudential backstop regulation to be compliant with their 2021 Pillar III disclosure requirements.

New Considerations

Beginning in June 2021, the frequency of disclosure for templates and tables could be quarterly, semi-annually, or annually depending on the nature of the specific template requirement and the size and complexity of the reporting institution. The revised regulation aims to promote market discipline through enhanced and comparable public disclosures for stakeholders, and to keep those reporting requirements in line with the evolving needs of supervisory authorities’ risk assessments. The requirements enable market participants to access key information about a financial institution’s regulatory capital and risk exposures – thereby increasing transparency and the overall adequacy of an institution’s regulatory capital.

Green Screen, Tropical Island, Mountain Scene – Where To Begin Can Seem Daunting

As financial institutions across Europe face another new regulation – amid a backdrop of pandemic-driven challenges, including remote working and operational cost overhead – they are asking themselves:

  • Can our internal systems collect required data points from across reporting modules such as common reporting framework (COREP), financial reporting (FINREP), and liquidity?
  • How do we ensure complete historical auditability with granular drilldown into all data and reporting results, given impending changes and future iterations of CRR, including CRR3?
  • Is our current data infrastructure prepared to handle new and evolving requirements, given remote working arrangements?

“Zooming” Was An Unknown, But With The Right Tools, Becoming An Expert Proved Easy

New things can often be intimidating, but with key techniques for adapting, the challenge can be overcome. Earlier this year, remote-communication technology presented obstacles for many and raised more questions than it answered. Similarly, the 2021 Pillar III disclosure requirements present institutions with specific issues that must be addressed, such as:

  • Data sourcing: Integrating quantitative information reported in the EBA supervisory templates
  • Data quality management: Ensuring consistency of information between the new Pillar III disclosure templates and reporting templates
  • Template/table formats: Aligning reporting requirements, including current CRR2 and a future CRR3
  • Scalability of processes and data architecture: Minimizing operational burdens

With regulatory changes occurring within the context of a post-pandemic environment and its unique challenges, it is even more important for financial institutions to have transparency into their data and calculations so that they can flexibly adapt to change. And all of this must be accomplished while managing operational costs.

AxiomSL’s Solution: A Few Clicks Enable A Connection  

Just as connecting via Zoom has become second nature – a few clicks connect us to people around the world – AxiomSL’s solution delivers a seamless process for institutions to address 2021 Pillar III disclosures leveraging their current infrastructure for similar reporting requirements. Running on the ControllerView® data management and analytics platform, AxiomSL’s solution for Pillar III disclosures enables financial institutions to:

  • Accurately populate the new disclosure templates leveraging data they have already collected for supervisory reporting requirements
  • Automate processes that incorporate updated EBA calculation rules on the platform
  • Create efficiencies with an end-to-end, technology-driven approach for transparent, scalable reporting within tight timeframes

AxiomSL’s proven technology enables organizations to satisfy the changes to Pillar III requirements and efficiently deliver the data integrity and auditability that the EBA demands. By maximizing automation and seamlessly integrating with current systems and architecture, either on-premises or through a secure cloud deployment, they also minimize operational costs. Furthermore, transparent, and granular data drilldown and historical lookback capabilities inform risk and reporting decision making for comprehensive risk management across their organizations.

No complicated green screens are needed to put technology to work here, just plug in and go!

AxiomSL’s expertise on 2021 Pillar III disclosures makes fulfilling requirements as simple as turning your Zoom background into a medieval castle, Contact us.

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