Regulatory reporting

Since the financial crisis, regulatory requirements in the banking sector have been steadily increasing. Since 2014 in particular, new regulatory management ratios such as the LCR, NSFR and leverage ratio have been introduced in addition to adjusted procedures for calculating RWA. These were flanked by a comprehensive European reporting system under COREP and FINREP.

A sustainable reporting system

The ECB and national supervisors have also increased the requirements for granular data management due to an increased need for transparency. Today, a functioning reporting system is no longer just about fulfilling formal requirements, but is also an important driver for bank management.

Challenges and influencing factors

Changing regulatory framework conditions: Reporting requirements are becoming increasingly complex and are subject to constant change. The regular revision of the EBA's data point model results in recurring adjustment cycles. In addition, the links to Pillar III and the number of ad hoc requests from Pillar II are increasing.

Reorganisation of supervision: SSM, ERF and BIRD - supervision is moving away from form-based reporting towards detailed reporting that requires granular (individual) data. The requirements clearly reflect the supervisory authority's aim to create comprehensive analysis options based on a consistent data set.

Technical pressure in the context of digitalisation: A future-proof reporting system is increasingly driven by IT. The reporting system must be integrated into the general digitalisation strategy. At the same time, data requirements and the demand for data quality are increasing due to constantly growing regulatory requirements with ever shorter deadlines and validations.

Business intelligence (BI) in the reporting system: By expanding the ability to analyse reporting data, including a graphical representation of the analysis, well-founded control impulses are generated for users at management level. BI places new demands on the organisation of the reporting system.

Alignment of the structural and procedural organisation: The reporting function can no longer be clearly distinguished from other organisational units and specialist disciplines. Numerous units are involved. Against this background, analysis, planning and control tasks are becoming increasingly important. In addition, expectations regarding cost optimisation and process efficiency have a strong impact on the reorganisation of the reporting system.

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Our services - the KPMG approach

KPMG can offer you competent partners for all aspects of regulatory reporting - you can benefit from our expertise in regulatory reporting, supervisory law or accounting as well as from our know-how at the interfaces between auditing and consulting or from technical design and IT implementation with the usual software products. In detail, we provide the following services:

Implementation projects and audits: We have many years of project experience in the implementation of new COREP and FINREP requirements in reporting, for example. We also have in-depth and broad benchmark expertise from regulatory audits. This means we can mediate between the specialist and IT areas and are familiar with the challenges in the banking sector.
Selection processes for software and tools: We support the selection processes for standard reporting software and tools on the basis of criteria catalogues that have been tried and tested on the market. In addition, we offer a structured end-to-end analysis of cross-divisional reporting processes and the automation of workflow processes.
Networking in the market: We are in direct contact with the German and European supervisory authorities through KPMG's ECB Office. We have extensive expertise in the providers and products available on the market.
Interfaces: KPMG is a fast mover in the RegTech market and an interface between clients and technology companies. We organise and participate in discussions/forums with start-ups within the most important incubators in Germany.
Outsourcing: KPMG takes over reporting, particularly for domestic branches and smaller banks, on a case-by-case basis, enabling its clients to realise cost potential while maintaining high process quality.
Brexit: We support various foreign banks in reorganising or rebuilding the reporting system in their branches or subsidiaries to meet not only European but also national requirements.
Technical and digital expertise: We offer extensive know-how on current regulatory requirements through daily trend scouting and our LexLinks information platform. We know the latest technological developments and are familiar with the expectations placed on standard software and reporting tools.