Regulation (EU) 2016/867 of the European Central Bank of 18 May 2016 on the collection of granular credit and credit risk data (ECB/2016/13)

THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 127(2) and (5) thereof,

Having regard to the Statute of the European System of Central Banks and of the European Central Bank, and in particular Articles 5.1 and 34.1 thereof,

Having regard to Council Regulation (EC) No 2533/98 of 23 November 1998 concerning the collection of statistical information by the European Central Bank (1), and in particular Articles 5(1) and 6(4) thereof,

Having regard to the opinion of the European Commission (2),

Whereas:

(1) Granular credit and credit risk data (hereinafter ‘credit data’) comprise detailed and individual information about instruments giving rise to credit risk for deposit-taking corporations, financial corporations other than deposit-taking corporations or asset management vehicles, which are all engaged in lending on a significant scale. Such detailed information is necessary for the performance of the tasks of the Eurosystem, the European System of Central Banks (ESCB) and the European Systemic Risk Board, including monetary policy analysis and monetary policy operations, risk management, financial stability surveillance and macroprudential policy and research. These data will also be useful for banking supervision purposes in the context of the Single Supervisory Mechanism (SSM).

(2) Article 5.1 of the Statute of the European System of Central Banks and of the European Central Bank (hereinafter the ‘Statute of the ESCB’) specifies that the European Central Bank (ECB), assisted by the national central banks (NCBs) of the ESCB, collects the necessary statistical information, either from the competent national authorities or directly from economic agents, in order to carry out the tasks of the ESCB. Article 3 of Regulation (EC) No 2533/98 requires the ECB to specify the actual reporting population within the limits of the reference reporting population, and entitles it to fully or partly exempt specific classes of reporting agents from its statistical reporting requirements.

(3) Credit data will substantially contribute to improving existing and developing new ESCB statistics, since it provides important breakdowns and details not available from currently used data sources, such as information on the structure and risk patterns of credit granted by the financial sector. For example, credit data will significantly contribute to increasing the quality of statistics on: (a) loans according to the size of corporations; a key feature for assessing and monitoring the provision of credit to small and medium-sized enterprises; (b) credit lines broken down by counterparty sector; (c) loans to non-financial corporations broken down by economic activity; (d) loans backed by real estate collateral; and (e) cross-border loans and related income as part of the balance of payments statistics of Member States whose currency is the euro.

(4) The availability of credit data will improve the usability of the micro-level information currently collected on securities issues and holdings statistics, and contribute to monitoring and fostering financial integration and stability in the Union. Finally, credit data relating to branches that are resident outside the euro area, and whose head offices are resident in a reporting Member State are important for the performance of ESCB tasks, in particular for monetary policy analysis and financial stability tasks. In addition, the data can support macroprudential supervision tasks such as financial stability analyses, risk assessments and stress testing. Article 8(1)(d) and (4a) of Regulation (EC) No 2533/98 now specifically allow the use of statistical data collected under Article 5 of the Statute of the ESCB for supervisory purposes.

(5) A comprehensive set of harmonised analytical credit data should minimise the reporting burden by increasing the stability of the reporting requirements over time. This is important because incorporating changes into the highly automated data processing systems of reporting agents can be very costly. The harmonised set of credit data will also provide greater detail, thus minimising the need for any additional requests addressed to reporting agents.

(6) Decision ECB/2014/6 (3) sets out the procedure for developing a long-term framework for the collection of granular credit data based on harmonised ECB statistical reporting requirements. It aims to ensure the establishment of: (a) national granular credit datasets operated by all Eurosystem NCBs in accordance with common minimum standards; and (b) a common granular analytical credit database (hereinafter ‘AnaCredit’), shared between the Eurosystem members and comprising input data from all Member States whose currency is the euro.

(7) Recommendation ECB/2014/7 (4) encourages NCBs of Member States whose currency is not the euro, but who are preparing to join the long-term framework, to apply the provisions of Decision ECB/2014/6. AnaCredit should be open, on a voluntary basis, to Member States outside the euro area, in particular those participating in the SSM, in order to broaden its geographical and data scope, and increase harmonisation across the Union.

(8) While the preparatory measures under Decision ECB/2014/6 aimed to define ‘a core group of harmonised granular credit data sets that are to be provided to the ECB by the NCBs in the long term’, the outcome of the merits and costs procedure showed very strong user requirements underlining the need not just for a ‘core group of data sets’, but also for a comprehensive list of data attributes and measures that characterise the instruments that generate credit risk for the reporting population. In addition, the resulting improved harmonisation should increase the comparability of the data across countries and across institutions, thereby ensuring a higher data quality for analysis.

(9) AnaCredit aims to provide, in combination with other statistical frameworks collecting granular information, an analytical view of reporting agents' credit risk regardless of the financial instrument, type of exposure or accounting classification. In this respect, the requirements laid down in this Regulation aim to ensure that reporting agents report a common set of harmonised information to NCBs.

(10) AnaCredit should be established in stages, since the significant heterogeneity of the current credit data collection across participating countries can only be gradually harmonised. This step-by-step approach also takes into account the time needed for the reporting agents to comply with the various data requirements. Overall, the scope and content of the data to be collected during the different stages should be defined as early as possible, in order for all reporting agents to prepare for the use of a harmonised set of concepts and definitions. Hence, the Governing Council will take its decision on each subsequent stage at least two years prior to its implementation. With a view to minimising the costs and the workload for reporting agents, the provision of information on housing loans on the basis of sampling techniques will be explored at a subsequent stage.

(11) While one of AnaCredit's key long-term objectives is to harmonise reporting requirements and implementation practices, the heterogeneity of current data collection practices requires the preservation of NCB discretion in certain areas, for example with regard to NCB decisions on derogations for small resident reporting agents. These areas of NCB discretion should be reassessed at each future stage in order to determine whether further harmonisation across participating countries can be achieved.

(12) In terms of scope, the first stage of reporting under AnaCredit should include credit granted by credit institutions to legal entities. Deposit-taking corporations other than credit institutions, asset management vehicles and other financial corporations, all engaged in lending, as well as foreign subsidiaries of these entities, may be included in the actual reporting population in a subsequent stage. As regards instruments, the scope of granular reporting may be extended to derivatives, other accounts receivable, off-balance-sheet items (such as financial guarantees) and credit extended to persons other than legal persons, including to sole proprietors. No personal data, as defined by applicable data protection rules, should be collected in the first stage, including for multi-debtor credits involving natural persons as debtors, or when natural persons are affiliated to instruments reported to AnaCredit. Should the scope of reporting be extended to include such personal data in subsequent stages, the protection of the rights of natural persons with regard to the collection and processing of their personal data should be ensured. Moreover, subsequent stages may incorporate reporting requirements on a consolidated basis. Any extension of the reporting population should take into account the NCBs' right to grant derogations to small reporting agents, and should be adopted at least two years prior to its introduction to allow sufficient time for implementation by reporting agents and NCBs.

(13) In preparing for future stages, an extension of the reporting population as well as an introduction of additional reporting requirements should be based on an analysis by the Statistics Committee of the ESCB (hereinafter the ‘STC’), taking into account the users' needs, reporting agents' and NCBs' estimated costs, market developments and the experience gained in preparing for the first stage.

(14) The reporting obligations on credit data should be defined taking into account the principle of proportionality, to avoid imposing an undue reporting burden in particular on small reporting agents with limited total credit exposure. For the same reason, NCBs should have the right to grant derogations to small reporting agents.

(15) With a view to ensuring efficient reporting and adequate interoperability with other existing or new reporting frameworks, NCBs should be allowed to collect the information to be transmitted to the ECB as a part of a broader national reporting framework and to extend the reporting of credit data beyond the scope outlined in this Regulation, for their own statutory purposes, in line with relevant national law.

(16) To contribute to AnaCredit, NCBs should be allowed to use their own databases, data received from reporting agents and any other sources, including relevant reference databases. NCBs should have the discretion to decide whether they enter into cooperation arrangements with national statistical institutes (NSIs), or national competent authorities (NCAs) for the supervision of reporting agents, or any other national authorities, as long as the data provided meet the quality standards set out in this Regulation. Due to the different national arrangements currently in place, and in order to minimise the reporting burden under this Regulation, effective and efficient collaboration with NSIs, NCAs and other national authorities is encouraged.

(17) The framework for the collection of credit data should be set up with a view to ensuring interoperability with central credit registers (CCRs) and other relevant credit data sets established by public sector entities, including databases on securities statistics as well as the ESCB Register of Institutions and Affiliates Dataset.

(18) NCBs should be allowed to use the multi-purpose shared analytical granular credit data set to establish feedback loops with reporting agents or to enrich existing feedback loops and other information services from CCRs to reporting agents. These feedback loops will enhance the ESCB's contribution to the stability of the financial system in line with its statutory mandate according to Article 127(5) of the Treaty on the Functioning of the European Union. The feedback loops will provide reporting agents with a broader basis for their creditworthiness assessments, in particular with regard to cross-border debtors, and enable the harmonisation of definitions and data attributes throughout their lending practices. They will improve credit institutions' and other lenders' credit risk management. In particular, they will support credit institutions in avoiding undue reliance on external credit ratings for assessing creditworthiness. A feedback loop should follow best practices and ensure minimum data quality standards. The subset of analytical credit data that may be shared between NCBs, for the purposes of the feedback loops, should be defined taking into account the specific confidentiality level of the relevant data attributes and the corresponding confidentiality protection requirements, as well as the time needed for implementation. Further details on the scope and implementation of the feedback loops may be laid down in a separate legal act and NCBs may enter into Memoranda of Understanding, based on the applicable legal frameworks, regarding their respective cooperation in the feedback loops. While some NCBs that operate CCRs already share granular cross-border credit and credit risk data with each other on a bilateral basis (5), others may, for legal reasons, require a certain time period to implement cross-border information sharing in order to pass such data on to financial institutions reporting to them. The set-up and implementation of feedback loops should take into account national legal provisions on the handling of confidential statistical information.

(19) For the purposes of this Regulation the standards for the protection and use of confidential statistical information as laid down in Articles 8 to 8c of Regulation (EC) No 2533/98 should apply.

(20) Article 7(1) of Regulation (EC) No 2533/98 provides that the ECB has the power to impose sanctions on reporting agents that fail to comply with statistical reporting requirements defined or imposed in ECB regulations or decisions. This sanctioning power is independent of NCBs' right to sanction reporting agents who do not comply with statistical or other reporting obligations that apply to them under the respective national legal framework.

(21) It is necessary to establish a procedure for making technical amendments to the annexes to this Regulation in an effective manner, provided they neither change the underlying conceptual framework nor affect the reporting burden on reporting agents in Member States. This procedure needs to allow the views of the ESCB Statistics Committee to be taken into account.

(22) Article 5 of the Statute of the ESCB, together with Article 4(3) of the Treaty on European Union, implies an obligation to design and implement at national level all the measures that the Member States whose currency is not the euro consider appropriate: (a) for carrying out the collection of the statistical information needed to fulfil the ECB's statistical reporting requirements; and (b) for timely preparations in the field of statistics in order for such Member States to become Member States whose currency is the euro.

(23) This Regulation should apply without prejudice to the collection of credit data under the legal framework of the SSM,

HAS ADOPTED THIS REGULATION:

Article 1

Definitions

For the purposes of this Regulation:

(1) ‘reporting Member State’ means a Member State whose currency is the euro; Member States whose currency is not the euro may decide to become a reporting Member State by incorporating the provisions of this Regulation into their national law or otherwise imposing relevant reporting requirements in accordance with their national law; this may include, in particular, Member States that participate in the SSM via close cooperation in accordance with Article 7 of Council Regulation (EU) No 1024/2013 (6);

(2) ‘resident’ has the same meaning as defined in Article 1(4) of Regulation (EC) No 2533/98;

(3) ‘institutional unit’ has the same meaning as defined in paragraphs 2.12 and 2.13 of Annex A to Regulation (EU) No 549/2013 of the European Parliament and of the Council (7);

(4) ‘foreign branch’ means an institutional unit which is a legally dependent part of a legal entity resident in a different country to that where the legal entity is incorporated in accordance with the concept of a ‘single branch’ referred to in Article 2(3) of Regulation (EC) No 2533/98;

(5) ‘legal entity’ means any entity which, under the national law to which it is subject, can acquire legal rights and obligations;

(6) ‘legal entity identifier’ (LEI) means an alphanumeric reference code in line with the ISO 17442 standard (8) assigned to a legal entity;

(7) ‘national identifier’ means a commonly used identification code which enables the unambiguous identification of a counterparty within its country of residency;

(8) ‘reporting agent’ means either a legal entity or a foreign branch that is resident in a reporting Member State and that is subject to the ECB's reporting requirements pursuant to this Regulation;

(10) ‘counterparty’ means an institutional unit that is a party to an instrument or has an affiliation with a party to an instrument;

(11) ‘creditor’ means the counterparty bearing the credit risk of an instrument, other than a protection provider;

(12) ‘debtor’ means the counterparty which has the unconditional obligation to make repayments arising under the instrument;

(13) ‘protection provider’ means the counterparty that grants protection against a contractually agreed negative credit event and that bears the credit risk of the negative credit event;

(14) ‘servicer’ means the counterparty responsible for the administrative and financial management of an instrument;

(15) ‘national central bank(s)’ or ‘NCB(s)’ means the national central bank(s) of Member States of the European Union;

(16) ‘relevant NCB’ means the NCB of the reporting Member State in which the reporting agent is resident;

(17) ‘central credit register’ (CCR) means a credit register operated by an NCB that receives reports from, and provides support to lenders in the financial sector, by providing them with credit and credit risk information;

(18) ‘credit institution’ has the same meaning as defined in Article 4(1)(1) of Regulation (EU) No 575/2013 of the European Parliament and of the Council (9);

(19) ‘institution’ has the same meaning as defined in Article 4(1)(3) of Regulation (EU) No 575/2013;

(20) ‘asset’ has the same meaning as defined in paragraph 7.15 of Annex A to Regulation (EU) No 549/2013;

(21) ‘credit risk’ means the risk that a counterparty fails to make any payments that it is contractually obliged to make;

(22) ‘contract’ means a legally binding agreement between two or more parties under which one or multiple instruments are created;

(23) ‘instrument’ means any item specified in the data attribute ‘type of instrument’, as defined in Annex IV.

(24) ‘protection’ means an assurance or coverage against a negative credit event, by means of any item listed in the data attribute ‘type of protection’ as defined in Annex IV;

(25) ‘commitment amount’ means the sum of the data attributes ‘outstanding nominal amount’ and ‘off-balance-sheet amount’ as defined in Annex IV;

(26) ‘on an individual basis’ means with reference to a single institutional unit, including institutional units that are part of a legal entity.

Article 2

Implementation stages and first reporting

Article 3

Actual reporting population

Article 4

Statistical reporting requirements

(b) where at least one debtor is a legal entity or is part of a legal entity as defined in Article 1(5).

Article 5

Reporting threshold

Article 6

Statistical reporting requirements on an individual basis

(a) the relevant NCB of the legal entity may decide not to collect any, or to collect only part, of the data attributes listed in Template 1 of Annex I from the legal entity, when such instruments are held or serviced by the foreign branch;

(b) the relevant NCB of the foreign branch may decide not to collect any, or to collect only part, of the data attributes listed in Template 2 of Annex I from the foreign branch.

Article 7

Specific statistical reporting requirements

The statistical reporting requirements defined in Article 6 shall be reduced with regard to credit data satisfying specific criteria as outlined in Annex II.

Article 8

General requirements for enhanced reporting

Article 9

Identification of counterparties

(a) an LEI, where such an identifier has been assigned; or

(b) if no LEI has been assigned, a national identifier, as further detailed in Annex IV.

Article 10

Access to and use of credit data

Article 11

Feedback loop to reporting agents

Article 12

Access by legal entities

(a) such access would violate the legitimate confidentiality interests of the reporting agent, for example with regard to internal credit risk assessments, or of third parties, in particular, the legal entities about which credit data has been reported; or

(b) the data has not been used to establish or enhance a feedback loop according to Article 11, and they are not required to grant access to such data under any other Union or national law.

Article 13

Timeliness

(a) for monthly transmissions, on the last day of each month;

(b) for quarterly transmissions, on the last day of March, June, September and December.

Article 14

Minimum common standards and national reporting arrangements

Article 15

Mergers, divisions and reorganisations

Article 16

Derogations and reduced reporting frequency

(a) reporting agents that have been granted a derogation in line with paragraph 1;

(b) reporting agents that may report data on a reduced reporting frequency in line with paragraph 2;

(c) reporting agents that no longer fulfil the conditions for a derogation or reduced reporting frequency in line with paragraph (1) or (2).

Article 17

Verification and compulsory collection and minimum quality standards

The NCBs shall verify and, to the extent necessary, carry out the compulsory collection of the information that reporting agents are required to provide pursuant to this Regulation, without prejudice to the ECB's right to exercise these rights itself. In particular, the NCBs shall exercise this right when a reporting agent does not fulfil the minimum standards for transmission, accuracy, compliance with concepts and revisions specified in Annex V.

Article 18

Sanctions

The ECB may impose sanctions on reporting agents who fail to comply with the reporting obligations of this Regulation in accordance with Article 7(1) of Regulation (EC) No 2533/98. Reporting agents shall not be subject to sanctions insofar as they demonstrate that they are prevented from reporting the required information by the national law of a country where the branch on which they are required to report information is resident. The ECB's power to impose sanctions for non-compliance with the reporting obligations of this Regulation is independent of an NCB's right to sanction, in line with its national law, non-compliance with statistical or other reporting obligations that apply to reporting agents under the respective national legal framework in line with Article 8(3).

Article 19

Transitional provision

NCBs may postpone the first transmission to the ECB of credit data relating to reporting reference dates prior to 1 February 2019 provided that they transmit such data to the ECB no later than 31 March 2019.

Article 20

Simplified amendment procedure

Taking account of the views of the STC, the Executive Board may make technical amendments to the annexes to this Regulation, provided that such amendments neither change the underlying conceptual framework nor affect the reporting burden for the reporting agents. The Executive Board shall inform the Governing Council of any such amendment without undue delay.

Article 21

Final provisions

This Regulation shall enter into force on the twentieth day following its publication in the Official Journal of the European Union.

It shall apply from 31 December 2017.

This Regulation shall be binding in its entirety and directly applicable in the Member States in accordance with the Treaties.

Done at Frankfurt am Main, 18 May 2016.

For the Governing Council of the ECB The President of the ECB Mario DRAGHI

(1) OJ L 318, 27.11.1998, p. 8.

(2) Commission Opinion of 7 August 2015 on the draft Regulation of the European Central Bank concerning the collection of granular credit and credit risk data (OJ C 261, 8.8.2015, p. 1).

(3) Decision ECB/2014/6 of 24 February 2014 on the organisation of preparatory measures for the collection of granular credit data by the European System of Central Banks (OJ L 104, 8.4.2014, p. 72).

(4) Recommendation of the European Central Bank of 24 February 2014 on the organisation of preparatory measures for the collection of granular credit data by the European System of Central Banks (ECB/2014/7) (OJ C 103, 8.4.2014, p. 1).

(5) Memorandum of Understanding on the exchange of information among national central credit registers for the purpose of passing it on to reporting institutions. Available on the ECB's website at www.ecb.europa.eu.

(6) Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, p. 63).

(7) Regulation (EU) No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European system of national and regional accounts in the European Union (OJ L 174, 26.6.2013, p. 1).

(8) Available on the International Organisation for Standardisation's (ISO) website at www.iso.org.

(9) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).

(10) Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338).

(11) Commission Implementing Regulation (EU) No 680/2014 of 16 April 2014 laying down implementing technical standards with regard to supervisory reporting of institutions according to Regulation (EU) No 575/2013 of the European Parliament and of the Council (OJ L 191, 28.6.2014, p. 1).

(12) Regulation (EU) No 1071/2013 of the European Central Bank of 24 September 2013 concerning the balance sheet of the monetary financial institutions sector (ECB/2013/33) (OJ L 297, 7.11.2013, p. 1).