ESCB approach to banks’ data reporting
The European System of Central Banks (ESCB) and its Statistics Committee (STC) strive to increase the efficiency of data collection from banks and to reduce their reporting burden, while continuing to provide policy makers and analysts with high-quality data.
They aim to standardise, harmonise and integrate existing ESCB requirements for the collection of statistical information from banks, as far as possible, across domains and countries. This will help automate data processing and enhance data quality.
This approach consists of two elements:
- The Integrated Reporting Framework (IReF) seeks to integrate the Eurosystem´s statistical reporting requirements addressed to banks.
- The Banks’ Integrated Reporting Dictionary (BIRD) helps banks to efficiently organise information stored in their internal systems and to fulfil their reporting requirements.
The IReF is part of the broader ESCB integrated reporting strategy which was published in September 2020 as ESCB input to the European Banking Authority (EBA) feasibility report mandated by the European Parliament and Council.
Eurosystem Integrated Reporting Framework
What is the IReF's objective?
The IReF project aims to integrate the Eurosystem’s statistical requirements for banks into a single standardised reporting framework that would be applicable across the euro area and might also be adopted by authorities in other EU countries.
The IReF mainly focuses on ECB requirements relating to banks’ balance sheet and interest rate statistics, securities holdings statistics, and granular credit data. To maximise the benefits of integration, the requirements arising from national collection frameworks, for example in the area of balance of payments and financial accounts, are also taken into account. In its initial stage, the IReF does not cover ECB statistical frameworks that do not directly relate to banks’ balance sheet assets and liabilities. For example, it does not cover ECB requirements relating to payments or money market statistics.
This approach aims to ensure proportionality by alleviating the reporting burden for small banks.
What are the advantages of the IReF?
Integrating existing statistical requirements in the IReF will help banks with their data reporting, standardising their reporting obligations, reducing redundancies and overlaps, minimising the reporting burden and enhancing data quality. The IReF will also help automate data processing and minimise the cost of any further changes. Banks operating in several countries will particularly benefit, as the integrated requirements enable consistent and standardised reporting across borders. Statistical compilers and other users will also benefit from the integration, as it ensures methodological soundness and increases the analytical value of the data.
What is the current status of the project?
In 2018, the Eurosystem initiated a cost-benefit analysis, in close cooperation with the banking industry, to assess the impact of the IReF. A qualitative stock-taking exercise was conducted from June to October 2018 to support the development of scenarios relating to various aspects of data collection and statistical production. Based on feedback received via the stock-taking questionnaire, the Eurosystem has developed a baseline scenario for the IReF. This baseline scenario will now be evaluated, in collaboration with interested stakeholders, by way of a cost-benefit assessment, which will be conducted by the end of 2020. All euro area countries, plus Sweden, will participate in the exercise.
The national central banks of the countries participating in the assessment will select the national respondents. Their selections will aim to cover at least 80% of their domestic banks in terms of total assets, while ensuring that institutions of all sizes and types are included. Every bank residing in the participating countries may express interest in joining the exercise by contacting their national central bank.
Based on the results of the cost-benefit assessment questionnaire, the Eurosystem intends to draft a regulation on the statistical reporting of banks under the IReF. The draft regulation will be subject to a public consultation before its adoption. This regulation will replace the existing legal provisions for the collection of the datasets that fall under the scope of the IReF. Relevant existing ECB regulations will be repealed or amended, as applicable.
The Eurosystem aims to implement the IReF in the period 2024-27. However, the timeline will be reviewed following the results of the cost-benefit analysis.
For additional information on the IReF, an assessment of the high-level results of the qualitative stock-taking questionnaire and the new cost-benefit assessment questionnaire (including a draft IReF reporting scheme), see the documents below.
The IReF replaced the European Reporting Framework:European Reporting Framework (ERF): Key facts and information, June 2015.
Helping banks produce statistical and supervisory reports.
The BIRD is an integrated reporting dictionary, which provides banks with up-to-date reference material to help them produce statistical and supervisory reports.
The BIRD was developed by the ESCB and the banking industry. Its documentation is freely available to all interested parties, who can decide whether or not they will participate in the initiative.
How do banks benefit from the BIRD?
The BIRD provides a precise description of the data that banks should extract from their internal systems to generate reports. It also offers clear rules for transforming these data so that they comply with reporting requirements. It aims to alleviate banks’ reporting burden and improve the quality of data reported to authorities.
How is the BIRD governed?
BIRD activities are carried out by an Expert Group comprising various national central banks and commercial banks. The group’s work is coordinated by the ECB.
These experts analyse reporting requirements addressed to banks and determine the data and related transformation rules required to meet these requirements. This is work that would otherwise need to be completed individually by every reporting bank. This helps ensure that data reported to authorities by banks are comparable, consistent and in compliance with requirements.
In addition, the BIRD Steering Group discusses and decides at least once a year on a roadmap for the next two years. This reflects new areas to be covered and important projects to be rolled out, such as data modelling or improving the BIRD’s usability. The Steering Group is composed of senior representatives of participating institutions.
How can the BIRD benefit from the IReF?
The BIRD is designed to generate outputs that are compliant with the requirements of European legal acts. However, national central banks may collect the necessary statistical information as part of their national statistical reporting frameworks. As these frameworks vary across countries, major country-specific adjustments would currently be required to implement the BIRD at the national level.
The IReF will support the BIRD by establishing a common collection layer for statistical data from banks across euro area countries. Reporting agents will thus be able to directly use the BIRD for statistical reporting without national adjustments.