AnaCredit reporting starts in September, but will Europe’s financial institutions have the data they need to disclose their lending to legal entities? Our recent webinar examined progress.
- AnaCredit reporting is a new Europe-wide requirement that aims to collect detailed information on the status of bank lending to legal entities.
- Our recent webinar revealed that preparations for AnaCredit reporting are mixed, with about half of respondents confident they will be ready.
- The prospect of further changes to the AnaCredit reporting regime means those currently exempt should keep a watching brief.
In the early 90s, the popular TV show ‘Gladiators’ featured the referee’s starting cry “Contender ready! Gladiator ready!”
We recently echoed this in our webinar on AnaCredit, which was attended by numerous banks and financial institutions from across Europe.
In response, almost half stated they were not ready!
While one-third were making progress, but not expecting to be ready for the September reference date, almost one-in-seven had not even started their preparations for AnaCredit reporting.
What is AnaCredit reporting?
AnaCredit — analytical credit datasets — is a new European Central Bank reporting legislation that aims to collect detailed information on the status of bank lending to legal entities in their respective countries.
Whenever a customer has an aggregate debt of more than €25,000 the bank will need to report details about the client entity and all the debt instruments on a loan by loan basis.
This means that lenders are required to report up to around 100 data attributes on the lending entity and the debt instruments themselves.
AnaCredit is being established in several stages and the first complete reporting period starts on 1 September.
The good news is that slightly above half are confident they will be ready. Interestingly, no-one stated they were ready immediately.
Perhaps around 50 percent level of readiness with six weeks to go (at time of webinar) should be viewed positively if compared to progress with other regulation deadlines.
One thing is for sure, those that have not started yet certainly need to pick up their shields!
Preparations for AnaCredit reporting
AnaCredit is one of a number of financial reporting demands, and firms will need to have systems and processes in place to meet these established requirements.
So an initial question when considering the approach is whether AnaCredit should be incorporated into the strategic infrastructure, or follow a tactical standalone approach.
The webinar attendees were split and somewhat undecided as the graphic below shows.
Perhaps the question I raised in my last blog post on possible legislative ‘sequels’ is part of the consideration for “standalone system or integrate?”.
Almost everyone agrees that the requirements will evolve and change over time.
If you are an exempt firm today, my advice is to keep a watching brief as half the attendees believe you will be among the first targets when change comes and you will be exempt no more.
That is not to say those already included and preparing for the big day can relax either. Almost two-thirds believed that the instruments that must be reported will be expanded.
So will you be ready?
To reduce the time and operational costs associated with AnaCredit compliance, our Verified Entity Data as a Service collects, validates and maintains a database of over 3.1 million entities from over 190 countries.
This provides you with the accurate and timely data they can rely on to facilitate decision making and regulatory reporting, on an ongoing basis.
Our Enhanced Data Service comprises modular based offerings for AnaCredit, Dodd-Frank, EMIT, FATCA and FCA Transaction Reporting.