Supervisory Reporting


Supervisory framework

Since 2014 banking and financial supervision is performed within the Single Supervisory Mechanism (SSM), i.e. the supervisory framework implemented by the European Central Bank together with national banks of countries belonging to the euro area.

In addition to the Single Resolution Mechanism, entered into force on 2016, the SSM is the key element of the EU regulatory framework in the banking field and aims at ensuring a uniform and harmonised supervisory framework.

The ECB supervises directly only credit institutions considered ‘significant’, while banks not belonging to this category are supervised by the Bank of Italy, according to European provisions.

The European Central Bank(for significant entities) and the Bank of Italy (for less significant entities)perform both on-site and off-site inspections, the latter through supervisory reporting, which means reports that institutions – falling within the scope of regulations – are required to provide according to existing provisions.

Provisions on monitoring of the banking system, and the relevant developments, derive from the need to guarantee sector stability, a sound and prudent management, transparent activities and the monitoring of corporate risks.

Following the financial crisis of 2008, national and European regulators updated the provisions regulating supervised entities, since they were not considered appropriate to forecast and limit systemic events.

The rules governing supervision can refer to the entire financial system (macroprudential supervision) or to single intermediaries (microprudential supervision).

  • Macroprudential supervision refers to the analysis of the financial system as a whole. The recent crisis highlighted how a systemic shock could take place and how it could impact on system, starting from identifying the weakness of the basic provisions.

Macroprudential supervision seeks to avoid the reiteration of these events, intervening on risk factors that could trigger such mechanisms. It draws attention also on the analysis of sector procyclicality and amplification processes of dangers originated by similar behaviour of market participants.

  • Microprudential supervision governs and monitors the behaviour of single intermediaries and it is jointly performed by the European Central Bank and the Bank of Italy. The former supervises ‘significant entities’, which means institutions deemed relevant, while the latter supervises the remaining part of national banking and financial system. Entities subject to direct supervision are chosen according to the outcomes of a regular monitoring on capital and financial situation, stress test exercises and compliance with prudential rules, performed by the Joint Supervisory Team (JST).

The supervisionof non-significant entities is assigned to the Bank of Italy, that carries out its monitoring exercise through supervisory reporting and on-site inspections. Reporting mainly refer to accounting, statistic and capital aspects.


International supervision

Banking union transferred many national competences to an international level, introducing the concept of harmonisation, which implies the introduction of univocal schemes in the development, application and monitoring methods of regulations. At a European level, rules are established by a single harmonised legal framework, called ‘Single Rulebook’.

The authorities supervising the sector operate within the scope of the European System of Financial Supervision (ESFS), established on 2010 and composed by the European Systemic Risk Board (ESRB), the three European Supervisory Authorities (EBA – European Banking Authority, ESMA – European Security Market Authority and EIOPA – European Insurance and Occupational Pensions Authority) and national supervisory authorities.

National supervisory authorities and the European Central Banks monitor single institutions, while EBA drafts technical implementing documents related to the provisions issued, through the Single Rulebook, Guidelines and Technical Standards aiming at safeguarding system and investors.

The Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM) are the key elements on which the European supervisory framework is based. The former defines the scope of monitoring activities performed by the ECB and national authorities, while the latter sets harmonised rules for the management and resolution of banking crisis by the Single Resolution Board.


Supervisory reporting

Supervisory reporting consists in processing data related to a set of information – on an individual or consolidated basis – referring to banks, securities firms and financial companies, required by supervisory authorities. The provision of such information is mandatory and it is carried out through reports.


Regulatory reporting contains capital and financial data, as well as prudential information and other disclosures useful for the monitoring performed by relevent authorities. These surveys (reporting bases) are produced using templates provided for harmonised supervisory reporting, based on the Data Point Model with an XBRL format.

The relevant provisions were issued on 2014, to create a singole framework for supervisory reportingcontaining statistical, financial and prudential information, based on a primary reporting and a secondary reporting.

The quality of the information is assessed throgh the application of validation rules.


IT structure for management of supervisory reporting

Rules for compiling aim at organising information according to supervisory autorities’ needs. Entities are required to have the appropriate IT and management tools, which allow to link internal accounting to data provided to supervisory authorities. The IT infrastrucutre has to support the process of creation, representation and sending of reports.

Save Consulting developed IT solutions dedicated to harmonised supervisory reporting, non-harmonised supervisory reporting and SRB. The TIGREARM suite can respond to any requrest of the regulators, thanks to the different modules.


Harmonised Reporting Module

The module of primary reporting of harmonised reporting is designed to manage both technical aspects such as:

  • XBRL language
  • Taxonomy

And qualitative aspects such as:

  • Templates with Excel format (COREP, FINREP, Financial Leverage, Exposure, Liquidity, etc.);
  • Domain values of each information item, presented with a double coding: code number and description;
  • Trasformation of EBA and ECB validation rules and relevant customisations by the Bank of Italy into a simple error reporting.

Strenghts of the Module:

  • Anomalies identied can be managed in a user-friendly manner
  • Processing and adjustments/data-entry procedures are rapid, allowing users to quickly reach a result, formally correct according to the preventive diagnostic control
  • Regualtory compliance with structures in use, current and previous versions of DPM.

Operative advantages:

  • Quick development of reporting
  • Overall coherence since some information are automatically calculated, avoiding time-consuming multiple data entering
  • Central management of technical and administrative structure, performed by Save Consulting itself, allowing for a regular update according to the reference period.

Like all other TigreArm modules, it is web-based and it can be used also for remote working


Non-harmonised reporting Module

It represents the ‘historical heritage’ of regulatory reporting. The module allows to manage non-harmonised regulatory reporting (so called ‘matrices’), following these steps:

  • Upload of the bases
  • Check of formal correctness and guided management (via dedicated drop-down menus) of adjustments
  • Re-generation of the bases, following adjustments
  • Generation, through the MidaBI module, of specific reports (predefined set of report) as well as reports referring to more general regulatory data governance, with the possibility to compare non-harmonised data with the harmonised ones.

Like all other TigreArm modules, it is web-based and it can be used also for remote working


SRF (Single Resolution Fund) Module

SRF is a TigreArm module that allows for a real-time generation of EACI supervisory reporting in XBRL format, starting from official templates published by the Single Resolution Board, as well as for its check according to validation rules.

Strengths of the Module:

  • Real-time generation of thereporting in the new XBRL format required by the Bank of Italy;
  • Possibility to enter data directly in EXCEL;
  • Facilitations for the filling-in (cells referring to totals are automatically populated);
  • Unlimited generations of XBRL reporting flows;
  • SRB validation rules integrated in the product.

Like all other TigreArm modules, it is web-based and it can be used also for remote working


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