CP13/6 - CRD IV for Investment Firms - Financial Conduct Authority

CP13/6
CRD IV for Investment Firms
2.12 However, CAD will be replaced by CRD IV, therefore the new definitions from CRD IV will apply
from 1 January 2014. These can be found at:
• ‘initial capital’ in article 4(51) of the Regulation;
• ‘own funds’ in article 4(118) of the Regulation (supplemented by an EBA technical standard);
and
• ‘fixed overheads’ requirement in article 97 of the Regulation (supplemented by an EBA
technical standard).
2.13 It is important to note that the draft legal instruments in the Appendix to this CP only contains
provisions as a result of the CRD IV, therefore other changes driven by the AIFMD – e.g. the
above consequential changes to the FCA Handbook – will be consulted on separately.
Implications of the new framework on Common Reporting (COREP) and Financial
Reporting (FINREP)
2.14 Article 99 of the CRR brings in a new EU-wide supervisory reporting framework for Financial
Reporting (FINREP) and Common Reporting (COREP) that applies to IFPRU investment firms.
COREP covers capital requirements, own funds and liquidity reporting whereas FINREP covers
consolidated financial reporting for supervisory purposes based on International Financial
Reporting Standards. The introduction of COREP and FINREP will change how IFPRU investment
firms report prudential supervisory information to the FCA. COREP will apply from 1 January
2014, whereas FINREP will apply from 1 July 2014.
2.15 Article 99(5) of the CRR requires the European Banking Authority to devise Implementing
Technical Standards (ITS) on supervisory reporting. These Standards contain the scope and
detail on what IFPRU investment firms will have to report under COREP and FINREP including
the reporting templates. The final draft ITS on supervisory reporting was published by the EBA
on 26 July 2013 and it is available on the EBA website.
2.16 The Regulation and the Directive include, in other articles, further reporting obligations on
IFPRU firms. Most of these reporting obligations are captured by COREP templates (for example,
CRR article 100 reporting on repurchase agreements and securities lending) but some are not
(for example, Pillar 2 reporting). We will request non-COREP/FINREP supervisory information
(e.g. Pillar 2) through submission of FSA0xx templates.
2.17 All IFPRU investment firms will have to complete COREP templates but conceivably not all IFPRU
investment firms will have to complete FINREP templates for consolidated financial reporting.
IFPRU investment firms will need to refer to Article 99 of the CRR and the ITS on reporting to
establish whether they are subject to FINREP, and which COREP and FINREP reporting templates
apply to them. (See also Chapter 4 under the heading ‘Liquidity reporting’). Firms that do not
have to complete FINREP templates will have to submit the FSA001 and FSA002 templates.
Furthermore, firms that complete FINREP templates for consolidated reporting will also have to
complete FSA001 and FSA002 for solo reporting.
18 July 2013
Financial Conduct Authority