The regulatory reporting environment is evolving due to initiatives such as BIRD, IReF, EBA's DPM Refit, and ESAP, which focus on standardizing data formats and minimizing redundancies. While this new landscape presents challenges, it also offers institutions opportunities to improve their reporting processes and data quality. Leveraging our expertise coupled with access to extensive global resources within the international PwC network, we assess the impact of these initiatives and offer our clients high-quality services to navigate the evolving regulatory landscape.
As supervisory authorities intensify efforts to standardize and streamline regulatory reporting, banks are compelled to adjust their reporting processes accordingly. However, unlike previous initiatives, the new requirements transcend mere reporting scope, encompassing the reporting process in its entirety. This expanded scope necessitates significant restructuring and reevaluation of existing reporting practices, requiring banks to invest more time, resources, and funds to implement changes effectively.
The number of initiatives underway complicates the situation. With some requiring simultaneous implementation alongside existing requirements, banks are encouraged to initiate preliminary studies for potential implementation to effectively manage the evolving regulatory landscape. Pilot projects conducted thus far have shown promising medium to long-term cost savings for reporting systems, providing added motivation for early adoption.
Whether it's the implementation of DPM ReFit, IReF, BIRD, or other "future of reporting" initiatives, we are here to help you. With our comprehensive expertise and access to the extensive knowledge of PwC experts worldwide, we're prepared to analyze the impact of all initiatives and provide high-quality services to our clients.
Banks Integrated Reporting Dictionary (BIRD)
What is BIRD?
- BIRD s a collaborative initiative between the Statistics Committee of the European System of Central Banks (ESCB) and institutes in banking industry
- The aim is to reduce the regulatory burden for banks, foster cooperation in the area of regulatory reporting and improve the quality of data reported to authorities
- For this purpose, BIRD offers a harmonized data dictionary and harmonized data model specifying how to extract and transform the data from the bank's internal IT systems in order to generate reports required by the authorities
Ongoing work and next steps?
- Analysis and inclusion of IReF together with the updates to FINREP (EBA ITS) as one of the top priorities going forward
- Further work towards full operationalization of the BIRD Transformation Rules
- Feasibility assessment for further integration of COREP and integration of ESG requirements
What are impacts and technical changes?
- BIRD does not impose any new regulatory requirements on banks or changes in IT systems
- However, as the first step towards BIRD adoption, banks need to assess the compatibility of their data models with BIRD and create a prioritized roadmap for transition to BIRD data model in close alignment with BIRD timeline
What is the timeline?
2015:
Launch of BIRD Pilot for AnaCredit and SHS
2018:
First BIRD extension for FINREP EBA ITS and COREP credit risk envisaged
2024:
Release of the latest BIRD Data Models and BIRD Transformation Rules
Advantages of the BIRD
Enhanced data quality - BIRD offers a standardized data model and references, promoting consistency and accuracy in transforming data from various sources. This aids in detecting and rectifying errors in data prior to its submission to regulatory bodies.
Ensured consistency - BIRD assists in maintaining consistency in data reporting across various banks and jurisdictions, enabling supervisory authorities to aggregate and analyze data more effectively.
Simplified reporting processes - BIRD simplifies the reporting process for banks by offering a common framework, thereby reducing the time and resources needed to meet reporting requirements.
Reduced reporting costs - BIRD aims to decrease reporting costs by streamlining the reporting process and minimizing the likelihood of errors.
PwC's BIRD (+) initiative
The PwC team is actively engaged in the BIRD initiative, with a strong emphasis on the workstreams on data modeling and on prototyping. Our primary goal is to develop frameworks that empower banks to maximize the value of BIRD outputs. These frameworks simplify the alignment of source data with the BIRD input layer, enabling banks to:
- Leverage ECB Initiatives
- Maintain control over reported data
- Create efficient data storage and generate regulatory reports
- Extend storage to encompass national and internal reports
- Handle manual data corrections effeciently
- Deploy the solution within your preferred IT environment — whether in the cloud or on-premises.
- Utilize GenAI to pinpoint the essential data within source databases
Integrated Reporting Framework (IReF)
Who is in Scope?
- The ESCB’s IReF project aims to consolidate and standardize statistical bank reporting by 2027
- The aim is to reduce the reporting requirements for banks, avoid duplicate data reporting and at the same time enable faster data availability and more comprehensive analysis options
- Four statistical reports – AnaCredit, SHS, BSI and MIR – will be merged into a single regulation to achieve simplified and consolidated reporting
- The reporting aims to be carried out on a highly granular basis, including on an individual loan, individual security and individual customer basis
Ongoing work and next steps?
- Publication of complementary cost-benefit assessment of the Integrated Reporting Framework (02/2024)
- Two further reports containing the results of the analysis of the remaining complementary CBA topics are expected to be published (~03/2024)
- The Eurosystem will perform a comprehensive comparison of costs and benefits based on the feedback received from stakeholders basis for drafting a Regulation on the IReF
What are impacts and technical changes?
- Standardised implementation and common data dictionary ensure uniform definitions
- Standardised reporting requirements foster the use of standard IT solutions
- In the long term, the integration of statistical, regulatory and settlement requirements is expected, which will bring further advantages for the banks
What is the timeline?
2023:
The IReF project entered the investigation phase
2025:
Expected Adoption of the IReF Regulation by the Governing Council
2027:
Expected going-live of IReF
The IReF project of the European System of Central Banks (ESCB) aims to consolidate and standardise statistical bank reporting by 2027. It is an essential building block for a new reporting standard, as statistical reporting requirements for banks will be reduced by not having to report data multiple times. At the same time, data will be available more quickly and a more comprehensive analysis based on detailed data will be possible.
In order to achieve the objective of simplified and consolidated reporting, four statistical surveys - credit data statistics (AnaCredit), securities holdings statistics (SHS), monthly balance sheet statistics (BSI) and MFI interest rate statistics (MIR) - are essentially combined in a single regulation.
The redesign of the data point model (DPM ReFit)
What are the goals?
- Establishment of a standardised and flexible meta-model for the entire regulatory data exchange
- A versatile metamodel designed to cover all regulatory data exchanges, from high-level summaries to detailed prudential, statistical, or transactional datasets
- Facilitating the potential for semantic integration of data dictionaries across diverse regulatory domains
- Creating content that is flexible and interoperable, allowing for the definition, reuse, and exchange of metadata to meet regulatory data requirements
Ongoing work and next steps?
- Interoperability API: The aim is to enable meta-exchange among DPM Refit repositories through a decentralized approach, employing open standards such as WS/REST. Initially, the version will be read-only, with a focus on utilizing DPM Refit ID and GUIDs to ensure seamless interoperability across different domains
- Governance: Creating a transparent process for maintaining the DPM Refit involves ensuring accessibility to relevant authorities and stakeholders. It should primarily address syntactical integration within the DPM methodology while supporting its ISO standardization through operational aspects
What are impacts and technical changes?
- Changes in the business and data quality rules
- A thorough review of the DPM-XL language, utilized for defining validation rules
- Elimination of redundant Information in the current data point model
- Possible host for the IReF data model
What is the timeline?
2012:
Started the development of the DPM ReFit Model
2024:
Start of DPM transition period
2026:
Expected going-live of DPM ReFit
Over the last decade, the DPM methodology has successfully proven to support EBA and EIOPA to integrate their respective regulatory frameworks. However, after all these years, the DPM Standard 1.0 needs some improvements to continue to meet the demands of change and reduce costs.
The DPM Refit initiative is a joint response by the EBA and EIOPA to the increasing volume and complexity of data and aims to increase cooperation and harmonisation. To this end, experts in the DPM Refit project have been working on further developing the DPM standard 1.0 and establishing the DPM standard 2.0.
European Single Access Point (ESAP)
Who is in Scope?
- ESAP
The aim is to provide easy centralised access to information about companies and their products in relation to financial services, capital markets and sustainability, a gradual publication of information must take place - P3DH
All EEA institutions, incl. large & other institutions and SNCIs
Disclosures performed at the highest level of consolidation (EU); large subsidiaries of EU parent institutions are also required to disclose on an individual basis or on a sub-consolidated level certain parts of information
Ongoing work and next steps?
- ESAP
Submission of drafts by 10 September 2024 - P3DH
Implementation and development of ITS (two months consultation period)
What are impacts and technical changes?
- ESAP
Collection points should be designated to collect the information from the companies - P3DH
Consistency of information between EBA P3DH and websites of institutes
Consistency xBRL and PDF
What is the timeline?
2023/2024:
ESAP: Publication of Regulation (EU) 2023/2859 establishing a single European access point
P3DH: Pilot on P3DH testing and further analysis
2024:
ESAP: Submission of drafts by September 2024
P3DH: Implementation and development of ITS
2025:
P3DH: Fully operational in line with CRR 3
2030:
ESAP: Voluntarily submission of information
As part of the Capital Markets Union Action Plan, the establishment of a European Single Access Point (ESAP) is planned by 2024 at the latest. It will enable EU-wide access to information on capital markets, financial services and sustainable finance.
The introduction of the ESAP will take place gradually according to the priorities of the authorities and is expected to be completed by 2030. However, due to the current legislative process, there are still uncertainties regarding the timetable, scope and exact design of the ESAP.
ESAP does not impose any additional information obligations on institutions. Rather, ESAP is intended to provide access to information that has already been published in accordance with the applicable European directives and regulations.
News in the PwC Regulatory Blog
Further publications on the future of regulatory reporting can be found in our Regulatory Blog
Our partnerships at a glance
Why cooperate with PwC
We cordially invite you to inform yourself about current developments and to join us in taking a reflective look at the starting position of your institute.
We are always available to answer any questions you may have. Our team of experts has been closely involved in initiatives relating to the future of the reporting system from the outset.
Take advantage of the opportunity to benefit from our comprehensive technical expertise, many years of experience in regulatory reporting and our competence in the area of IT implementations.
Thought leadership
We take into account the changes in the reporting system. In doing so, we focus on "lean" regulatory reporting. The latest regulatory requirements are analyzed by our experts and prepared with innovative solutions.
Technological expertise
We are a team of certified specialists and can draw from a portfolio of diverse tools to assist with report validation, calculation and disclosure.
Managed Services
As part of our managed services, we already help with the establishment of complete reporting for IFR, AWV and FinaRisikoV. With our innovative reporting tool, we create ready-to-submit XBRL reports in the shortest possible time, which are checked against over 9,000 validation rules from the EBA, ECB, SRB and national supervisory authorities. New compatible reports are added continiously.
Data Management
Discover our data management framework and optimize your business potential!
Our advanced anomaly analyses enable you to recognize unusual patterns at an early stage and identify potential challenges and opportunities.
Experienced experts in regulatory reporting and EBA stress test
Our team is characterized by extensive expertise in regulatory reporting:
• COREP, FINREP, AnaCredit, statistics, etc.
• IFR reporting
• Pillar 3 disclosures
• Ad hoc reporting (STE, B3 monitoring, etc.)
• Future of Reg Reporting (BIRD, IReF, etc.)
