Supervisory Disclosure


The purpose of supervisory disclosures is to enhance transparency of supervisory practices. Transparency is a key element in effective banking supervision, as emphasized by the Basel Committee on Banking Supervision in its Core Principles on Effective Banking Supervision. In terms of articles 143 and 144 of the Directive 2013/36/EU as amended by Directive 2019/878/EU (hereunder the ‘CRD’) and the Commission Implementing Regulation (EU) 2019/912 of 28 May 2019, amending Implementing Regulation (EU) No 650/2014 laying down implementing technical standards with regard to the format, structure, contents list and annual publication date of the information to be disclosed, National Competent Authorities (‘NCAs’) are required to disclose and provide a comprehensive overview of the supervisory and regulatory framework in their respective jurisdiction. The information disclosed aims at enabling a meaningful comparison of the approaches adopted by the NCAs of the different Member States. Comparison is further enhanced through a common set of templates (Annexes) provided by the European Banking Authority (‘EBA’).

  1. Rules and guidance: the texts of laws, regulations, administrative rules and general guidance adopted in Malta in the field of prudential regulation;
  2. Options and national discretions: the manner in which Malta Financial Services Authority (‘Authority’) exercises options and national discretions available in EU law;
  3. Supervisory review: the general criteria and methodologies used by the Authority in the Supervisory Review and Evaluation Process (SREP);
  4. Aggregate statistical data: key aspects of the implementation of the prudential framework in Malta (e.g. assets, capital requirements, Pillar I and Pillar II data, supervisory measures and administrative penalties).

The scope of the information published covers licence holders falling within the scope of the CRD and subject to the direct supervision of the Authority (i.e. LSI credit institutions and CRR investment firms). The below sections provide links to Authority’s supervisory disclosure requirements.

  • Rules and Guidance
  • Options and National Discretions
  • Supervisory Review
  • Aggregate Statistical Data

The supervisory disclosure information related to significant credit institutions (‘SI”s’) is published by the European Central Bank (‘ECB’) as the competent authority for the Single Supervisory Mechanism (‘SSM’) and can be accessed at: Banking Supervision

External links:

Rules and Guidance

In accordance with Article 143(1)(a) of the CRD IV, the Authority is required to publish information on legal and regulatory texts adopted in Malta in the field of prudential regulation, including:

  • Laws and regulations adopted by Malta to implement the provisions of CRD IV and CRR. These texts outline the primary supervisory requirements for supervised credit institutions and investment firms.
  • Administrative rules, i.e. instructions to supervised banks on how to comply with legislative and regulatory requirements.
  • General guidance, i.e. explicit disclosure requirements under CRD IV and explanations deemed necessary to set out how the rules should be applied by institutions, as well as any other relevant information to enhance the understanding of the capital adequacy framework.

The tables below are divided into eight parts, in accordance with Commission Implementing Regulation (EU) 2019/912 as follows:

  • Part 1            Transposition of Directive 2013/36/EU
  • Part 2            Model approval
  • Part 3            Specialised lending exposures
  • Part 4            Credit risk mitigation
  • Part 5            Specific disclosure requirements applied to institutions
  • Part 6            Waivers for the application of prudential requirements
  • Part 7            Qualifying holdings in a credit institution
  • Part 8            Regulatory and financial reporting

Annex I – Rules and guidance – credit institutions

Annex I – Rules and guidance – investment firms

Options and National Discretions

CRR and CRD IV provide a number of options and national discretions which may be applied on the basis of national circumstances. The Authority, in such situations, is given a choice as to how (‘option’), or whether or not (‘national discretion’), to apply such options and discretions within the parameters of EU legislation.

In accordance with Article 143(1)(b) of the CRD IV and Commission Implementing Regulation (EU) 2019/912, the following tables are made up of three parts as follows:

  • Part 1   Overview of options and discretions set out in Directive 2013/36/EU, Regulation (EU) No. 575/2013 and LCR Delegated Regulation (EU) 2015/61
  • Part 2    Transitional options and discretions set out in Directive 2013/36/EU and Regulation (EU) No 5758/2013
  • Part 3    Variable elements of remuneration (Article 94 of Directive 2013/36 EU)

Annex II – Options and National Discretions – credit institutions

Annex II – Options and National Discretions – investment firms

Supervisory Review

Pursuant to Article 143(1)(c) of Directive 2013/36/EU (‘CRD IV’), the Authority is required to publish information on the general criteria and methodologies used in the Supervisory Review and Evaluation Process (‘SREP’) referred to in Article 97 of the CRD IV.

Supervisory disclosures cover the following aspects of SREP:

  • Scope of application of the SREP (including proportionality)
  • Individual risk assessment
  • Review and evaluation of ICAAP & ILAAP
  • Overall SREP assessment and supervisory measures

Information disclosed can be found in the following tables:

Annex III – SREP – credit institutions

Annex III – SREP – investment firms

Aggregate Statistical Data

Article 143(1)(d) of the Directive 2013/36/EU (‘CRD IV’) requires competent authorities to disclose aggregate statistical data on key aspects of the implementation of the prudential framework in their respective jurisdiction. The information includes consolidated data on the financial sector, Pillar I (credit risk, market risk and operational risk), waivers as well as supervisory measures and administrative penalties.

The reference date for the data is 31 December of the preceding year.

The scope of the information published covers licence holders falling within the scope of the CRD and subject to the direct supervision of the Authority (i.e. LSI credit institutions and CRR investment firms).

The supervisory disclosure information related to significant credit institutions (‘SI”s’) is published by the ECB as the competent authority for the Single Supervisory Mechanism (‘SSM’) and can be accessed at: Banking Supervision.

The links to the other competent authorities’ websites pages on aggregate statistical data can be accessed from the Aggregate Statistical Data section on the EBA website.

Information disclosed can be found in the following table:

Annex IV – Aggregate statistical data – credit institutions and investment firms

Disclaimer

The table displayed in this section only contains aggregated statistical data on central aspects of the implementation of the CRD IV in a standardised form. No confidential information which the competent authority may receive in the course of its duties may be divulged to any person or authority whatsoever except in summary or collective form, such that individual credit institutions cannot be identified, without prejudice to cases covered by criminal law. Accordingly, whenever the disclosure of aggregate statistical data would result in a breach of confidentiality as determined by the competent authority, then this information should not be disclosed.