Circular 3/2015 of the Bank of Spain modifying Circular 1/2013 on the Credit Risk Information Centre and Circular 5/2014 on financial reporting standards

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VIEW OF THE REGULATION

Index

Full Regulation

Regulation at a Specific Date

Current Regulation

Circular 3/2015, of July 29, of the Bank of Spain, amending Circular 1/2013, of May 24, on the Credit Risk Information Centre; and Circular 5/2014, of November 28, amending Circulars 4/2004, of December 22, on public and reserved financial information standards and financial statement models, Circular 1/2010, of January 27, on interest rate statistics applied to deposits and credits to households and non-financial corporations, and Circular 1/2013, of May 24, on the Credit Risk Information Centre (BOE of August 12).

Circular 5/2014 has as its main objective to adapt the content of public and reserved financial information to the preparation criteria, terminology, definitions, and formats of the statements known as «FINREP» (FINancial REPorting) in European Union regulations. Additionally, it contains new statistical and supervisory information requirements that the Bank of Spain must provide to international bodies.

The submission and receipt of the first financial statements regulated by Circular 5/2014, related to the statistical requirements of the Economic and Monetary Union, have not been free from operational difficulties, which have affected both the Bank of Spain and the reporting credit institutions.

To the difficulties encountered, one must add the risk that future European Central Bank regulations related to credit risk information, known as «AnaCredit» (Analytical Credit Dataset), and the future modification of Annex IX of Circular 4/2004, may cause the accounting statements and modules of Circular 1/2013, of May 24, on the Credit Risk Information Centre (hereinafter, the CIR), which institutions will presumably have to prepare, to differ significantly from those they will have to submit under the current Bank of Spain regulations.

All of this has advised modifying, postponing, and even, in some cases, repealing the criteria for adopting and submitting accounting statements and some modules of the CIR, in order to conduct an in-depth analysis of certain conceptual, technical, and operational issues that will allow, as soon as possible, to take measures aimed at reinstating the information that is now repealed, facilitating the tasks of institutions and the Bank of Spain and reducing their costs.

Furthermore, the date for the submission by significant groups of individual financial information of subsidiaries established in EU Member States not participating in the Single Supervisory Mechanism, or in third countries, is recalled.

Finally, the periodicity of some statements in Circular 4/2004 is modified.

Consequently, in exercise of the powers granted, the Governing Council of the Bank of Spain, upon proposal of the Executive Committee, has approved this circular, which contains the following regulations:

First Regulation.

The following modifications are introduced into Circular 5/2014, of November 28, amending Circulars 4/2004, of December 22, to credit institutions, on public and reserved financial information standards and financial statement models; 1/2010, of January 27, to credit institutions, on interest rate statistics applied to deposits and credits to households and non-financial corporations, and 1/2013, of May 24, on the Credit Risk Information Centre:

1. In the first regulation, in section 24, which modifies the sixtieth regulation, letters a) and d) are replaced by the following text:

«a) In section 6 ter, the first paragraph is modified, which reads as follows:

“6 ter The institution shall disclose the number and gross book value of refinancing, refinanced, and restructured operations according to the definition contained in letter g) of section 1 of Annex IX of this circular, with detail of their classification as doubtful risk (distinguishing the part without real collateral from that with such collateral), as well as their respective credit risk coverages, and broken down by counterparties and purposes. As additional information, operations of this nature classified as non-current assets and disposal groups that have been classified as held for sale shall be indicated. The breakdown and presentation of the quantitative information to be published in the notes in accordance with the provisions of this section shall be carried out in accordance with the format of statement PI 6, Refinancing and Restructurings individual public, insofar as this information is concerned.”»

«d) In section 16 bis, the following modifications are made:

– Letter a) is replaced by the following text:

“a) The gross amount, the excess of said amount over the value of the assets serving as collateral –estimated in accordance with the provisions of Annex IX of this circular– and impairment losses on assets that have the nature of specific coverages for all financings, in the form of loans and credits, with and without mortgage collateral, and debt securities, destined for construction and real estate promotion, with an additional breakdown of financings that are classified as ‘doubtful’.

The gross amount of said financings that have been written off from assets due to being classified as non-performing assets shall also be indicated.

Along with this information, as a memorandum, the book value of loans to customers, excluding Public Administrations, corresponding to business in Spain and the total assets corresponding to total business shall be provided. Additionally, the total amount of impairment losses and provisions established by the institution to cover exposures classified as normal, corresponding to total business, shall also be provided.”»

– The penultimate paragraph of letter d) is replaced by the following text:

“The breakdown and presentation of the quantitative information to be published in the notes in accordance with the provisions of this section shall be carried out in accordance with the format of statement PI 7, Financings for construction, real estate promotion and acquisition of housing (business in Spain) individual public, of Annex I, insofar as this information is concerned.”»

2. In the first regulation, in section 29, which gives a new wording to the sixty-seventh regulation, the following modifications are made:

– In the list of statements in section 1, statements FI 101, FI 130, FI 131, FI 135, and FI 137 are deleted.

– In section 7, references to statements FI 135-1 and FI 135-2 are deleted.

– In section 9, references to statement FI 137 are deleted, and the first paragraph of section 10 is drafted as follows:

«The Bank of Spain may require, from institutions that do not exceed the thresholds established in the previous sections by December 31, 2014, to send statement FI 103, and by September 30, 2016, the thresholds for sending statements FI 105, FI 106, FI 136, FI 139, FI 140, and FI 142, to present all or some of said statements, with the periodicity and maximum submission deadline established generally. The requirement shall be made in writing, with a minimum advance of three months before the first submission, taking into account the particular circumstances of the institutions, especially their risk profile and the amount representing the activity to be reported in relation to their size.»

3. In the first regulation, in section 31, which gives a new wording to the sixty-ninth regulation, a new section 5 is added, with the following text:

«5 Credit institutions referred to in section 1 of this regulation whose groups have the status of significant for the purposes of the Single Supervisory Mechanism shall submit quarterly templates 1.1, 1.2, 1.3, 2, 4.1, 4.2, 4.3, 4.4, 4.5, 5, 8.1, 8.2, 9.1, 10, 11.1, 12, 14, 18, and 19, relating to financial information on a consolidated basis (FINREP) in accordance with the formats established in Annex III of Implementing Regulation (EU) No 680/2014, with the individual information of each of the dependent entities established in EU Member States not participating in the aforementioned Single Supervisory Mechanism, or in third countries, whose total assets exceed 3,000 million euros, no later than the fortieth working day following the date to which the data refer. For these entities, when they begin to submit said statements, statements FC 201-1 and FC 201-2 shall not be submitted.»

4. The single transitional provision is replaced by the following text:

«Single Transitional Provision.

1 For statistical purposes, statements C 1 and C 3, with data relating to June 30, 2015, must be sent to the Bank of Spain before August 31, 2015.

2 For statistical purposes, statements FI 1 to FI 45, with data relating to December 31, 2015, must be sent to the Bank of Spain before June 30, 2016.

3 From the entry into force of the modification of Annex IX of Circular 4/2004, in the current statements, while they remain in force, the current items will continue to be used, although the amounts must be calculated applying the new criteria provided for in the aforementioned Annex IX.

4 Until their repeal, statements M 14-1, M 14-2, and M 14-3 will have quarterly periodicity.»

5 The single final provision (Entry into force) is replaced by the following text:

«This circular shall enter into force according to the following schedule:

a) The modifications introduced by the first regulation in Circular 4/2004, on March 31, 2016, except:

i) the modifications made in the seventy-first regulation, which shall enter into force on December 31, 2014;

ii) the modifications made in Annexes VII, VIII.3, IX, and X, which shall enter into force on December 31, 2014;

iii) the replacement of the current Annexes I, II, and III with the new ones, which shall enter into force on June 30, 2016;

iv) the suppression of the statements of the current Annex IV, which shall be carried out according to the following schedule:

a. statement M 10 shall enter into force on April 1, 2015;

b. statements M 11, T 19, T 20, and T 22 shall enter into force on December 1, 2015;

c. statements S 6, S 7, S 8, S 9, and S 10 shall enter into force on January 1, 2016;

d. statement M 9 shall enter into force on October 1, 2018;

e. the remaining statements shall enter into force on April 1, 2017.

v) the entry into force of the statements of the new Annex IV, which shall be carried out according to the following schedule:

a. statements FI 1 to FI 45 shall enter into force on March 31, 2016;

b. statement FI 103 shall enter into force on April 30, 2015;

c. statement FI 104 shall enter into force on October 30, 2018;

d. the statements provided for in the new section 5 of the sixty-ninth regulation shall enter into force on June 30, 2016;

e. the remaining statements shall enter into force on March 31, 2017.

vi) the suppression of the statements of the current Annex V, which shall be carried out according to the following schedule:

a. statements C 2, C 4, C 8, C 11, C 12, C 13, C 15, C 16, C 19, and C 20 shall enter into force on December 31, 2014;

b. statements C 1, C 3, C 6, C 7, C 9, and C 14 shall enter into force on January 1, 2015;

c. statements C 17, C 18, C 21, and C 22 shall enter into force on January 1, 2016;

d. statement C 23 shall enter into force on January 1, 2017;

e. statements C 5 and C 10 shall enter into force on April 1, 2017.

vii) the entry into force of the statements of the new Annex V, which shall be carried out according to the following schedule:

a. statement FC 201 shall enter into force on March 31, 2015;

b. statements FC 140, FC 200, and FC 202 shall enter into force on March 31, 2017.

viii) the suppression of Annex VI, which shall enter into force on April 1, 2016.

b) The modifications introduced by the second regulation in Circular 1/2010, on December 31, 2014.

c) The modifications introduced by the third regulation in Circular 1/2013, on April 1, 2015, except letters a) and e) of section 9, which shall enter into force on December 31, 2014.»

6 In Annex A, statements FI 100-2, FI 101, FI 130, FI 131, FI 135, and FI 137 are deleted, and statements PI 6, PI 7-1, PC 6, PC 7-1, FI 13, FI 18-1, FI 18-2, and FI 19 are replaced by those included as an annex to this circular.

Second Regulation.

The following modifications are introduced into Circular 1/2013, of May 24, on the Credit Risk Information Centre:

1 In the first regulation, in the last paragraph, the expression «In this case, institutions shall declare the data affected by the prohibition in an aggregated manner, in accordance with the provisions of the thirteenth regulation, letter B)» is eliminated.

2 In the second regulation, in section 3, the second paragraph is replaced by: «Notwithstanding the above, operations shall not be declared individually when they are term loans (provided that their purpose is consumption, their amount at the start of the operation does not exceed 3,000 euros, and their original term is equal to or less than twenty-four months), non-recourse factoring whose accumulated limit per debtor does not exceed 3,000 euros, credit cards, overdrafts, pension or salary advances, or other demand loans, and, in addition, all holders meet the following criteria:»

3 In the third regulation, in section 5, in the first paragraph, the expression «except when their operations are declarable in an aggregated manner, in accordance with the provisions of the second regulation, section 3.» is replaced by «except when their operations are not declarable, in accordance with the provisions of the second regulation, section 3.»

4 In the fourth regulation, the following modifications are made:

– In section 1, modules E, H, and I are deleted.

– Section 2 is replaced by the following text:

«2 The following reporting entities shall not have to declare the modules indicated below, even if they have data susceptible to declaration in them:

a) Branches in Spain of credit institutions whose registered office is located in another country of the European Economic Area shall not declare module D.

b) Mutual guarantee societies shall not declare modules F, G 2, and G 3.

c) The Bank of Spain, the Deposit Guarantee Fund of Credit Institutions, reinsurance societies, and the State-Owned Anonima Agrarian Caution Society (SAECA) shall not declare modules D, F, and G.»

5 In the seventh regulation, in section 4, the expression «, which shall be declared in module H 3, Complementary dynamic data of loans,» is deleted.

6 The ninth, twelfth, and thirteenth regulations are deleted.

7 In the fourteenth regulation, the following changes are made:

– In section 1, the fourth paragraph is deleted.

– In section 3, letter a) is replaced by the following text:

«a) If the transferor institution declares to the CIR, the acquirer institution must relate in module G.1, Basic data linking codes, the codes it assigns to the operations with the codes used by the transferor institution for them, but it shall not have to declare the data of modules A, B, C, and D relating to the acquired operations and the persons involved in them.»

8 In the fifteenth regulation, in section 1, the expression «modules A, B, D, and E» is replaced by «modules A, B, and D».

9 In the first transitional provision, the following modifications are made:

– In section 1, the first paragraph is replaced by the following text:

«1 Reporting entities will continue to declare to the CIR in accordance with the provisions of Circular 3/1995, of September 25, until the closure of the declaration relating to data of March 31, 2016, inclusive, regardless of whether they also have to begin to declare data, as provided in this circular, from the deadlines indicated in the following section.»

– In section 2, letter d) is deleted, and letter e) is replaced by the following text:

«Modules D, from data corresponding to December 31, 2016. Notwithstanding, data from modules D 1 to D 3 corresponding to operations that are presumed to have to be declared by that date may begin to be declared from November 1, 2016. »

– In section 3, letter g) is deleted.

10 In Annexes I and II, modules E, H, and I are deleted.

11 In Annex II, in module B.2, the following modifications are made:

– In the dimension «Product Type», in the explanation of the products «Credit accounts with staged drawdowns» and «Loans with staged drawdowns», the expression «In the latter case, the amount to be provided to third parties is declared in the dimension «Available Risk. Amount available to third parties» of module H 3, Complementary dynamic data of loans» is deleted.

– In the dimension «Maximum limit available to the borrower at the start of the operation», at the end of the third paragraph of the explanation, the expression «See the data «Available Risk. Amount available to third parties» of module H 3, Complementary dynamic data of loans» is deleted.

12 In Annex II, the explanation of the dimension «Code of the direct counterparty» of module G 2 is replaced by the following text:

«Code of the direct risk holder that the institution considers as the direct counterparty of the operation for accounting purposes.»

Single Final Provision. Entry into force.

This circular shall enter into force the day following its publication in the Official State Bulletin.

ANNEX

ANNEX-C-3-2015.PDF (290 KB)

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