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.
Supervisory Benchmarking Portfolios (SBP) are mainly used for the annual supervisory benchmarking of institutions within the EU as well as their competent authorities as required by the Capital Requirements Directive (CRD IV). In particular, the IT Standards specify the benchmarking portfolios as well as the document templates, definitions and IT solutions, which should be used for the benchmarking practice concerning Market Risk and Credit Risk (CR).
The SEPA Direct Debit (SDD) is a procedure provided since November 2009, which enables cross-border direct debit within the European Monetary Union. Since February 1, 2014 it has replaced all national direct debit systems. Its functions are very similar to the old debiting system. In the SDD you need the IBAN and the BIC instead of account number and bank code for a SEPA transaction.
The Supervisory Examination Programme (SEP) is a guideline, which was published by the European Banking Authority (EBA) as a part of the Capital Requirements Directive (CRD IV). The SEP contains regulations for authorities concerning the comprehensive supervision of institutions. One of these regulations is the Supervisory Review and Evaluation Process (SREP).
The Securities Financing Transaction Regulation (SFTR) was published at the suggestion of the Financial Stability Board (FSB) and states, that all repurchase agreements and securities lendings have to be reported regardless of both trading partners.
Shadow Banking means companies in the financial markets, which act as financial intermediaries outside the regular banking system. The first word "Shadow" can lead to the wrong impression as an institution doing illegal business transactions and/or evading the market supervision. However they are just diverse institutions and markets, which cannot be classified as traditional banks, although they comply with the typical functions of a bank.
The Single Rulebook should harmonize the European Banking Supervisory Law, because it is an uniform framework. It contains a set of rules, such as the Capital Requirements Directive (CRD IV), the Capital Requirements Regulation (CRR I), the Bank Recovery and Resolution Directive (BRRD) and the Deposit Guarantee Schemes Directive (DGSD).
The Standardized Measurement Approach (SMA) is a new evaluation approach for the Operational Risk (OpRisk), which was published by the Basel Committee on Banking Supervision (BCBS) on March 4, 2016. It combines the simplicity and comparability of the standardized approach (STA) with the risk sensibility of the advanced measurement approach (AMA).
The German Solvency Regulation (German: Solvabilitätsverordnung; SolvV) is a national regulation by the Federal Financial Supervisory Authority (BaFin). It contains regulations concerning the adequate capital base of financial institutions. Among other regulations, the SolvV was also affected on a Europen level by adaptions caused by the Capital Requirements Directive (CRD IV) and the Capital Requirements Regulation (CRR I).
The Single Resolution Board (SRB) convenes in case a bank supervised by the Single Supervisory Mechanism (SSM) has gotten into financial difficulties. It decides upon the use of funds from the Single Resolution Fund (SRF) and is responsible for the proper resolution of the affected banks.
Together with the Single Resolution Fund (SRF), the Single Resolution Board forms the Single Resolution Mechanism (SRM).
The Supervisory Review and Evaluation Process (SREP) is a directive for supervisory authorities published by the European Banking Authority (EBA) on December 19, 2014 and part of Pillar II. Since 2016 these authorities must get a fill picture of the risk situation of the banks, for which the new directives also have great importance.
The Single Resolution Fund (SRF) is a fund for the financial support for the resolution of banks. If the capital of a bank in distress is not enough for its coverage, the Single Resolution Board (SRB) can refer to the Single Resolution Fund. This should be built up to 55 billion EUR. The resolution fund is financed by all banks based in the European Monetary Union.
Together with the Single Resolution Board (SRB), the Single Resolution Fund forms the Single Resolution Mechanism (SRM).
The Single Resolution Mechanism (SRM) was established on January 1, 2015 and introduced Europe-wide uniform rules for the restructuring and resolution of European banks in distress. Together with the Single Supervisory Mechanism (SSM) and the European Deposit Insurance Scheme (EDIS), it forms the cornerstones of the European Banking Union. The SRM consists of the Single Resolution Board (SRB) and the Single Resolution Fund (SRF).
The Single Supervisory Mechanism (SSM), also known as the European Banking Supervision, was established by the European Central Bank (ECB) to directly supervise the biggest banks of the Monetary Union. Affected banks need to:
The three biggest banks of each country of the European Monetary Union are supervised by the SSM in any case.
Together with the Single Resolution Mechanism (SRM) and the European Deposit Insurance Scheme (EDIS) it forms the cornerstones of the European Banking Union.
The Step-in Risk means the risk that a bank will need to provide financial support to a company beyond the contractual obligation in the case of financial problems.
Stress Tests are a instrument of risk management and of the supervisory authorities. Stress Tests are intended to analyze the effects by constructing certain risk scenarios. They can be performed by the institutions themselves, but also by superior authorities such as the European Central Bank (ECB), the Federal Financial Supervisory Authority (BaFin) or the national central banks and especially serves the additional classification of the different risk types.
The Supervisory Reporting Manual describes the data framework to support the conduct of financial market supervision. The manual is an internal document, approved by supervisory board of the European Central Bank (ECB), and lays down the approach for supervisory reporting and describes the data and reporting framework for the Single Supervisory Mechanism (SSM).