15 September 2014

EBF response to two EBA consulation on Operational Risk and guidelines on materiality, proprietary and confidentiality.

EBF response to EBA consultation on AMA for Operational Risk

The EBF welcomes the consolidation of existing rules and guidelines in a single document. It should contribute to the convergence of industry practices and allow for improving the robustness and efficiency of our internal models. Nevertheless, potential changes introduced at European level before BCBS developments would create an uneven global playing field.

It will be important to reflect on:

• how the measures introduced can be considered even by non-AMA banks on their way to advanced methods and
• how to ensure uniformity of detection in the case of consortia participated not only by advanced banks.

EBF recognises the objective of EBA to put some constraints in the framework of the advanced methods but we reiterate here the absolute importance of preserving a range of approaches that go from the standard ones to those where the degrees of freedom left to individual banks are still relevant and maintaining intrinsic consistency of CRR framework.

Full response

EBF comments on the EBA consultation on draft guidelines on materiality, proprietary and confidentiality and on disclosure frequency

The EBF would like to firstly highlight its overarching concern that, similar to the BCBS Consultation on the Pillar 3 Review, this EBA Consultation appears to indicate that the regulatory community is determined to introduce a divide in the area of banks’ risk disclosures between accounting and Pillar 3 frameworks, resulting in both frameworks ultimately moving into a different direction.

EBF strongly challenges that the EBA has been given a legal mandate to make proposals to that effect. EBF strongly opposes such a move as it is likely to bring confusion to preparers and users of risk disclosures alike. It is essential that both risk disclosure frameworks would not merely co-exist but interact between each other with a view of presenting an integrated view to the users on the basis of identical policies and processes.

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