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Resolution Reporting – Challenge for Banks

Resolution Reporting – Challenge for Banks

 

What is Resolution Reporting?

Resolution reporting includes a set of regular and ad-hoc reports that banks submit to supervisory authorities. These reports are used to assess how well an institution is prepared to deal with a potential crisis.

Crisis resolution involves restructuring the institution to ensure the continuity of its critical functions, minimize the impact of its failure on the economy and financial system, and restore the viability of the whole or part of the failing institution.

These reports must be consistent with other regulatory statements such as COREP, FINREP, AnaCredit, and be ready upon request from the regulator.

Supervisory authorities require banks to provide ever more detailed information regarding:

  • their liabilities and funding structure (e.g., client deposits, obligations to other financial institutions, issued bonds),
  • key functions (e.g., payments and payment services, public sector servicing, deposit-taking and lending), and
  • crisis management capabilities.

Proper resolution reporting setup is now a key element not only of regulatory compliance.

Main Challenges for Banks

Banks are required to:

  • ensure data quality and sufficient granularity,
  • establish clear responsibilities,
  • conduct scenario testing to verify crisis preparedness.

Banks should also:

  • automate data processing to minimize manual adjustments and reduce errors,
  • integrate resolution reporting with other regulatory requirements to avoid duplication and ensure data consistency.

How Can a Bank Prepare Effectively?

  • Create a central data model for all resolution outputs
  • Set up data quality controls and audit trails
  • Train teams, especially in IT, risk management, and compliance
  • Maintain regular communication with the regulator and monitor methodological updates
  • Invest in reporting tools that enable fast aggregation and export

Regulators are continuously tightening requirements. Banks that have reporting under control not only meet legal obligations but also strengthen their reputation and resilience.

Collaboration with ARM

In connection with resolution reporting, ARM offers consulting services in the following areas:

  • training and workshops
  • methodology development for regular report preparation
  • monitoring of methodological updates
  • data quality control setup

Users of CADCalc® Market software can leverage its database to prepare inputs for resolution reporting. The software records transaction data, enables liquidity analysis, and supports risk management. By combining this data, outputs that meet regulatory requirements can be generated automatically – quickly, consistently, and without unnecessary manual adjustments. This means fewer errors, shorter processing times, and greater certainty that all regulatory requirements will be met.

Key Legal Regulations for Resolution Reporting

  • BRRD Directive (2014/59/EU) – Framework for bank crisis resolution, requirements for resolution plans and data (transposed into Czech law via the Recovery Procedures Act No. 374/2015 Coll.)
  • BRRD II Directive (2019/879/EU) – Strengthening requirements for MREL, coordination, and data granularity (effective from December 28, 2020 – amendment to the BRRD, transposed into Czech law by Act No. 298/2021 Coll.)
  • SRMR Regulation (806/2014) – Banking union mechanism, role of SRB and national resolution authorities (applies to significant banks in the eurozone, Czech National Bank cooperates)
  • EBA ITS on Resolution Planning Reporting (EU 2018/1624) – Implementing technical standards – detailed templates and data formats, e.g., LDR (Liability Data Report), Critical Functions Report (2025 update (EBA/ITS/2025/04) tightens structure and deadlines). Please note that the SRB will no longer collect the current LDR/CFR/FMIR/CIR templates, as these will be replaced by a harmonized template designed under the revised ITS. https://www.srb.europa.eu/en/content/2026-resolution-reporting
  • Delegated and Implementing Acts to BRRD – Technical standards for asset valuation, critical functions, MREL (issued gradually since 2016, complements BRRD)
  • Implementing Regulation (EU) 2021/763 – Reporting and disclosure of MREL and TLAC (closely linked to resolution reporting)
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