EBA: Common credit risk definitions vital
European regulators have overhauled bank reporting standards to ensure comparability, with new Finrep and Corep templates to be rolled out from this month. The latest step has been to agree common definitions for forborne and non-performing exposures. Remi Boutant and Meri Rimmanen explain why these classifications are important
The financial crisis highlighted divergences in reporting practices and definitions across Europe, hampering the ability of regulators to gain a comprehensive view of risk, and adding to the compliance burden for cross-border banks. European regulators have since taken large strides forward in ensuring the availability of comparable and good-quality credit risk data across the European Union (EU)
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