The AnaCredit Project - The creation of a new European central credit register

The draft ECB Regulation on the new reporting of information for the Analytical Credit Dataset (AnaCredit) was published on 07.12.2015. In accordance with this, from the middle of 2017, approx. 100 data fields with information about loans, borrowers and loan collateral will have to be reported via the national central banks to the ECB.

Objectives

The data collected on granular types of credit should, on the one hand, be made available for the creation of new statistics as well as, on the other hand, improve the quality of the statistics that already exist. Both aspects should help with the performance of the tasks in the Eurosystem. The areas that are subsumed under this include monetary policy analysis, risk management, financial stability as well as support for banking supervision. It is against this background that the Analytical Credit Dataset ("AnaCredit“) project was initiated by the ECB. 

Timetable

Figure 1: Timetable for the implementation of AnaCredit

 

Timetable up to Entry into Force

The implementation of the AnaCredit Regulation will not commence before the middle of 2017 and will begin with national reporting to the Bundesbank (German Federal Bank) (master data reporting and potentially also quantitative data) until the reports with the data as at 31.03.2018 are forwarded to the ECB. The Bundesbank has already announced that it will start with a test phase before advance reporting is launched. While previously there were still references to several (three) phases for the implementation, in the current draft these are no longer explicitly defined. Instead, there are now references to a "first phase" and "following phases". Therefore, it may be expected that, over time, adjustments will be made to the guidelines on AnaCredit by the regulator (such as to the group of those subject to reporting requirements, products that are relevant for regulatory reporting as well as borrowers). 

Entry into Force and Reporting Framework

When the reporting threshold is reached, the reporting obligation will comprise providing an individual credit data set for each borrower (loan-by-loan approach) with the field information in accordance with the AnaCredit requirements. 

The reporting threshold at which the individual transactions will have to be transmitted to the ECB by those subject to reporting requirements is EUR 25,000 per borrower. In the case of "non-performing or impaired" loans, a reporting threshold of EUR 100 per borrower will be applicable and all the borrower's loans will then have to be reported.

At the start, all credit institutions will be obliged to report their loans. Products that are relevant for regulatory reporting are overdrafts, credit card debt, reverse repurchase agreements, trade receivables, financial leases, own deposits (insofar as these constitute assets) and off-balance sheet arrangements such as credit lines and commitments. Financial and non-financial companies as well as public sector entities constitute borrowers that are relevant for regulatory reporting. 

In principle, AnaCredit will have to be reported on a monthly basis and this will include the personal master data. Sub-monthly reporting in the event of changes to master data will no longer required. Only the data requirements concerning accounting and counterparty risk (the probability of default) will have to be reported on a quarterly basis. 

Off-balance sheet transactions such as guarantees, sureties and derivatives might possibly subsequently become subject to mandatory reporting as well as loans to unincorporated partnerships, sole proprietorships and traders. Housing loans made to private individuals have not been included in the first phase. Nevertheless, the recommendation of the Financial Stability Committee (FSC), from 30.06.2015, is currently being examined with a view to determining in what way this can be implemented after all so that the existing data gaps in this market segment in Germany can be filled.

Subsequently, the Bundesbank will anonymise the data for sole proprietorships, sole traders and private households and pass it on to the ECB. Furthermore, it is expected that, in a later phase, the report will be supplemented by a consolidated group report. Moreover, the group of those subject to reporting requirements will probably be significantly broadened and national central banks, money market funds, investment funds, insurance companies and pensions funds will be included.

Contents of / Attributes in the Reports

The latest version of the ECB's data requirements comprises a total of 101 data fields (or 94 plus seven identifiers) that have to be interpreted and provided separately for each loan depending on the relevance. Here, the requirements can be roughly classified into: 

  • information about lenders, 
  • information about borrowers, 
  • information about transactions, 
  • information about collateral providers,
  • information about collateral and 
  • information for identifying loan pools and contractual obligations. 

The following data requirements will be viewed particularly critically with regard to their availability:

  • size of the business partner (number of employees / turnover),
  • date of initial legal proceedings,
  • cumulative recoveries since default and
  • original value of collateral at the transaction date.

In addition to the 101 data fields, the Bundesbank will be able to request still more attributes that are not included in the regulation. These will be subject to new national rules that have not yet been published.

Further Questions and Open Issues 

In terms of scope as well as complexity, the reporting of AnaCredit data presents institutions with challenges that should not be underestimated and which should be addressed in good time. As so often in the past, an institution's internal data repository will play a significant role. AnaCredit shows that it is absolutely essential to have a standardised data platform with information from the areas of master data, risk management, accounting/book-keeping  and reporting. 

The requirements for the data repository in respect of availability, granularity and quality are high. For each of the data fields it will be necessary to clarify whether or not and where the data with the required granularity is available.