This glossary contains terms and abbreviations in the field of regulatory reporting. It should help you to get a quick and general overview of the respective terms.
The Federal Financial Supervisory Authority (BaFin) is to ensure a functional, stable and trustworthy financial system in Germany. Its main tasks are the granting of banking licenses, the issuing of regulation and the fight against money laundering.
The Regulatory Requirements for IT (German: Bankenaufsichtliche Anforderungen an die IT; BAIT) was announced as a requirement for Germany and was published by the Federal Financial Supervisory Authority (BaFin) on October 9, 2014. The actual content and range have not yet been finalized. A finalization of the IT-Requirements respecting Minimum Requirements for Risk Management (MaRisk) is expected to come in the future.
Basel I was the first agreement about the adequate equity base of banks by the Basel Committee on Banking Supervision (BCBS) and resulted from the crisis of the Bankhaus Herstatt settled in Cologne in the 90s. According to this, credit institutions have to hold back 8% of their liable equity in relation to their risk-weighted assets for the coverage of default risks.
From 2004 on Basel I was gradually replaced by Basel II, which has been binding since January 1, 2007.
Basel II contains equity requirements, which have been published by the Basel Committee on Banking Supervision (BCBS). The package replaced Basel I from 2004 on and has been binding since January 1, 2007. The main target is to put the equity requirements in a greater accordance with the risk entailed. The main parts are Pillar I, Pillar II and Pillar III. Since December 2010 Basel II has been replaced by Basel III, which will be binding from January 1, 2019 on.
In Germany the implementation was done by the German Banking Act (KWG), the German Solvency Regulation (SolvV), the German Regulation on Large Loan Exposures and Million Loans (GroMiKV) and the Minimum Requirements for Risk Management (MaRisk).
Basel III is a new framework with amended equity and liquidity requirements published by the Basel Committee on Banking Supervision (BCBS) on December 16, 2010, which should replace Basel II step by step.
The introduction of a debt measure (so-called Leverage Ratio) as well as measures to curb potential pro-cyclical effects of the risk-sensitive equity requirements are parts of the package. Pillar I, Pillar II and Pillar III are taken from Basel II, but all three have been updated.
The focus is on the definition of equity capital and a necessary minimum ratio with the objective of finding a balance between a stable financial system and the avoidance of a credit crunch, as well as the reduction of the liability of the public authorities and taxpayers.
The implementation in the EU is to occur gradually through the new version of the Capital Requirements Directive (CRD IV) by January 1, 2019.
Basel IV was expected by many to be a new version of Basel III. However, Mark Carey (associate director of the Financial Stability Board (FSB)) contradicted the rumors about Basel IV on November 9, 2015. The progressive implementation of Basel III will bring enough innovation until 2019.
The Basel Committee on Banking Supervision (BCBS) was founded by the central banks and banking supervisory authorities of the G-10 countries in 1974. It convenes quarterly. Its main task is the development of guidelines and recommendations for the introduction of high and uniform standards in banking supervision. Representatives of 27 international central banks are part of the BCBS.
The BCBS 239 contains principles for the development of risk reporting by the Basel Committee on Banking Supervision (BCBS). Among other things the improvement of the infrastructure of reporting, the decision-making process across groups and information management. In Germany BCBS 239 was implemented by the Minimum Requirements for Risk Management (MaRisk).
The Banks' Integrated Reporting Dictionary (BIRD) offers a standardized model to organize the integration of the banks' internal databases. It covers the transformation of the data to fulfil the required reportings. Attention should be paid to the fact, that BIRD is just a form of documentation, not an IT tool and it is completely optional.
The Monthly Balance Sheet Statistics (German: Bilanzstatistik; BISTA) is a survey of the assets and liabilities of banks by the Deutsche Bundesbank (BuBa). It is calculated at the end of each month and is the most comprehensive statistical survey. The Monthly Balance Sheet Statistics forms the main part of the banking statistical reporting.
The Bank Recovery and Resolution Directive (BRRD) is an EU directive concerning the recovery and resolution of credit institutions. It supports the Single Resolution Mechanism (SRM) and is an essential part of the Single Rulebook.
The Deutsche Bundesbank (BuBa) is the central bank of Germany and part of the European System of Central Banks. Its main tasks include ensuring price stability, processing transactions, managing currency reserves and the first analysis of numbers.