The EBA consults on the amendments to the Pillar 3 disclosure and supervisory reporting frameworks in the context of the implementation of the Basel III reforms in the EU

• With the early publication of These consultation papers, the EBA seek to provide clarity and support institutions in the implementation of the latest Basel III reforms laid down in the Banking Package.
• The draft amending Implementing Technical Standards (ITS) will ensure the availability of data to supervisors and users of Pillar 3 information. This data is crucial to monitor compliance by institutions with the Basel III framework and will foster consistent and enhanced supervision and market discipline.
• The alignment of the disclosure requirements with the Basel III framework and its integration with reporting will promote comparability and consistency of the information.

The European Banking Authority (EBA) today launched a public consultation on two draft ITS amending Pillar 3 disclosures and supervisory reporting requirements. These consultation papers are a first step in the implementation of the Banking Package (Capital Requirements Regulation – CRR3 – and Capital Requirements Directive – CRD6). With this early publication the EBA wants to support banks in their reporting and disclosure obligations linked to the implementation of the Basel III reforms from the application date, and to ensure that supervisors and market participants have the necessary information. The consultations run until 14 March 2024.

These amending ITS aim to provide clarity on the coming changes, as explained in the EBA Roadmap on strengthening the prudential framework, which is also published today. In line with the Roadmap, the EBA will follow a two-step sequential approach to amend both the Pillar 3 disclosures and supervisory reporting ITS, prioritizing, in step 1, those changes necessary to implement and monitor Basel III requirements in the EU. Later in 2024, as part of step 2, the EBA will develop those reporting and disclosure requirements that are not directly linked to Basel III implementation, together with those requirements with an extended implementation timeline. 

In particular, these draft ITS seek to implement the changes related to the output floor, credit risk, including immovable property (IP) losses, capital valuation adjustment (CVA), market risk and leverage ratio. The amendments related to the new operational risk are not covered by these consultation papers but will be consulted on together with some policy products at the beginning of 2024. 

When developing these consultation papers have been developed, the EBA has sought alignment and integration between the disclosure and reporting frameworks, to facilitate institutions' compliance with both requirements, and a mapping between the revised disclosure templates and the reporting templates is also being published today. 

Consultation process and next steps

Comments to both consultation papers can be sent to the EBA by clicking on the "send your comments" button on the consultation pages. Comments to the Pillar 3 disclosures and supervisory reporting are expected to be submitted separately. Please note that the deadline for the submission of comments is 14 March 2024. All received contributions will be published at the end of the consultations, unless requested otherwise.

A public hearing on the draft ITSs will take place via online meeting on 23 January 2024 from 9:30 to 13:30 CET. Please register for the hearing here by 19 January 16:00 CET.

Following the consultation period, the two draft ITS will be finalised and they are expected to be submitted to the European Commission by June 2023.

Legal basis and background

Regulation (EU) No 575/2013 (‘the CRR’) mandates the EBA, in articles 434a and 430(7), to develop uniform disclosure and reporting requirements. These requirements are included respectively in the Commission Implementing Regulations (EU) 2021/637 and 2021/451. These ITS need to be updated whenever prudential or supervisory requirements change as is now the case with the CRR3/CRDVI. 

The forthcoming Banking Package will implement the latest Basel 3 reforms, which will strengthen the EU institutions’ prudential framework, including also the related new and amended reporting and disclosure requirements for institutions.