Statistical Notices to Reporting Banks 2004/01
Statistical Notices should be received by all those responsible for the completion of Bank of England returns. To add names to the circulation list please contact Michelle Child (Tel. 020 7601 3644).
- Form PL (effective immediately)
- Changes to rounding tolerances on certain international forms (effective immediately)
- RepoClear: clarification of counterparties (effective immediately)
- Update to the Classification of accounts guide (effective end-February 2004 reporting)
- Expansion of the EU (effective Q2 2004)
- New Form CE (effective end-December 2004 reporting)
- Changes to Forms B1 and C1 (effective end-December 2004 reporting)
- Contents page for Yellow Folder (update)
1. Form PL (effective immediately)
Following discussions with several banks we have made two small changes to reporting requirements for Form PL to bring it more in line with banks' usual reconciliation of their profit and loss accounts. Firstly we have changed the definition for Item 20A (net provisions for bad and doubtful debts) to make it the charge to profit and loss account rather than the change in levels of provisions and secondly we have changed the validation calculation for item 15, pre-tax profit on ordinary activities. We have also updated the definitions in order to clarify the reporting of sections 24 and 25 (interest receivable/payable to non-residents).
If you would like to discuss these changes in more detail please contact John Elliott (Tel.020 7601 4174). Updated pages of the form, validations and definitions, are attached for insertion in the Yellow Folder.
The Form PL frequently asked questions pages have also been updated with some additional questions.
If you have any queries relating to Form PL, please contact the Bank via e-mail.
We have also taken this opportunity to update several sections of the Yellow Folder in order to reflect the change from Forms A3/BP to Form PL. Pages of various definitions (BT, DQ, QX) and sections of the Classification of Accounts guide (General Notes & Definitions, General Introduction) have been updated for insertion in the Yellow Folder.
2. Changes to rounding tolerances on certain international forms (effective immediately)
In Statistical notice 1999/07 we advised that we were able to accept a rounding tolerance of up to and including 3 for the internal validations on forms CA, CC, CL, C1 and B1 and the cross-form validations between these forms and other returns. We have recently reviewed the size of these tolerances and have decided to increase the level from 3 to 10 for Forms CA, CC, CL and B1 only. The tolerance level for the C1, and from end-December 2004 the new Form CE, will remain at 3.
Therefore, with immediate effect, we will accept a rounding tolerance of up to and including 10 for the internal validations on Forms CA, CC, CL and B1 and the cross-form validations between these forms and other returns. However, we will only accept a rounding tolerance of up to and including 3 for the internal validations on Form C1, and from end-December 2004 the new Form CE. Neither the C1 nor CE has any cross-form validations.
Should you have any queries relating to these changes, please contact Vicki Black (Tel. 020 7601 5573).
3. RepoClear: clarification of counterparties (effective immediately)
Further to the guidance set out in Statistical Notice 2000/01, banks clearing repos through RepoClear and reporting positions with LCH.Clearnet Limited (formerly London Clearing House) are reminded that this facility is backed by a total of nine counterparties: German, Belgian, Austrian, Dutch, Irish, Finnish and Portuguese government bonds; German Jumbo Pfandbriefe repos and cash bonds; and Gilt repo and associated cash products.
Banks are reminded to report their net positions with LCH.Clearnet Limited as repos or reverse repos with other UK residents (Items 6H or 30H for Gilts, 7H or 31H for other paper) on the Form BT, with a sectoral classification of financial corporations (Items 6H1 or 30H1 for Gilts, 7H1 or 31H1 for other paper) on the Form BE, and an industrial classification of other activities auxiliary to financial intermediation (Item 17B on the Forms AD and AL).
If you have any queries relating to this item, please contact Alison Franklin (Tel. 020 7601 5356).
4. Update to the Classification of Accounts Guide (effective end-February 2004 reporting)
We have updated some of the lists within the Classification of Accounts guide (eg. Building societies, credit unions and eligible banks list). There have also been a number of public sector reclassifications since the last update; these are shown below:
| Name | Formerly | Now |
| British Council | Central Government | Public Corporations |
| British Transport Police | Public Corporations | Central Government |
| Export Credits Guarantee Department | Central Government | Public Corporations |
| Highlands and Islands Enterprise | Public Corporations | Central Government |
| (Former) local authority bus companies | Public Corporations | Non-financial corporations other than public corporations |
| Ordnance Survey | Central Government | Public Corporations |
| Partnerships UK | Public Corporations | Non-financial corporations other than public corporations |
| Tay Road Bridge Joint Board | Local Government | Public Corporations |
Any existing business should be reclassified with effect from end-February 2004 reporting. When submitting these data please advise either Alison Franklin or Erica Wong Min of any reclassifications, either via e-mail or in writing, to the usual address.
The sector classification lists for building societies, credit unions and factors and discounters have also been updated (and can be found here), as has the eligible banks list. If you have any queries relating to classification please contact the Help Desk on 020 7601 5360.
5. Expansion of the EU (effective Q2 2004)
As from 1 May 2004 the European Union will expand by 10 countries - Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic and Slovenia.
For income and expenditure data, reported on Form PL, data should be reported entirely on the expanded EU from the beginning of Q2 2004, i.e. as though the new countries had joined on 1 April 2004 rather than 1 May 2004.
For levels data, reported on Forms CH (section B), A2 (section B) and CL (section B), the expanded EU should be reported as from end-June 2004 data.
The country region classification lists have been amended and are attached. If you have any queries on the reporting of Form PL data for the expanded EU, please contact John Elliott (Tel. 020 7601 4174). If you have any queries on the reporting of levels data for the expanded EU, please contact Vicki Black (Tel.020 7601 5573).
6. New Form CE (effective end-December 2004 reporting)
As from end-December 2004 there is going to be a change in the reporting of country exposures data for all UK-owned banking groups. This change will be effected through the introduction of a new reporting form, Form CE, which will replace the current Form C1 for these institutions. The first Form CE will need to be reported for data as at 31 December 2004.
In autumn 1999 the Committee on the Global Financial Systems (CGFS) began a review of the Bank for International Settlements' (BIS) international banking statistics with a view to maintaining their status as a key data source for developments in international financial markets. Following consultation with BIS reporting countries and their reporting banks, the BIS published a summary of the proposed enhancements to the reporting of consolidated country exposure data on 7 February 2003. Since then, we have been consulting with the FSA about the detailed changes required to the existing C1 return and also with the BIS about refinements to definitions.
Following these negotiations it was decided that the most practical way to collect the data required by the BIS would be to replace the current C1 return with a new return (Form CE) for the UK-owned banks only.
The revised return has been discussed and agreed with the FSA; and David Dooks, Director of Statistics at the BBA, is aware of the proposals. The changes needed to meet the new BIS requirements are as follows:
- Separate reporting of total non-UK offices' non-local currency claims on local residents, including a sectoral split of this business between banks, public sector and 'other'. This business is currently included indistinguishably in total cross border claims.
- A sectoral split of business between banks, public sector and 'other' for non-UK offices' local currency claims on local residents. Currently only the total is requested.
- Separate reporting of inward and outward risk transfers for
the following categories of business:
- Cross border claims, broken down between banks, public sector and other;
- Total claims on local residents, broken down between banks, public sector and other;
- Claims under contract in financial derivatives.
The current C1 return requests inward and outward risk transfers for total cross border business plus non-UK Offices' non-local currency claims on local residents with just a bank and 'other' breakdown. We do not currently collect any risk transfer information for either local currency claims on local resident or claims under contract in financial derivatives. - Separate reporting of guarantees and other credit commitments plus a risk transfer analysis for each category. These two items are currently reported as total unused external commitments with a sectoral and risk transfer analysis. A sectoral analysis of guarantees and other credit commitments will not be required on the new return.
In summary, the additional items that we are proposing to introduce on the new Form CE to meet BIS requirements involve either a separate identification of business already reported within existing items or an expansion of sectoral or risk transfer detail.
There have also been some definitional changes. The main areas of note are:
- A change in the valuation method for the banking book, to be valued at face value or cost price.
- A change in the treatment for banking International Organisations, to be classified as public sector as opposed to banks on the current Form C1.
- Credit derivatives and collateral recognised as risk mitigants and therefore included within risk transfer items.
- Risk transfers are shown separately for cross-border and local currency business. Therefore, if the nature of a claim changes from being a cross-border claim on an immediate borrower basis, to being a claim on a local resident on an ultimate risk basis, this will need to be reflected within the reporting of risk transfers on the form.
We have attempted to make the definitions for completing the form as clear as possible and included examples where practical to help assist your understanding. Also, where relevant, we have amended the Classification of Accounts Guide.
In addition, some UK-registered subsidiaries of UK-owned banking groups are also asked to report country exposure data separately via the Form C1. These institutions may choose whether they wish to switch to reporting the new Form CE from end-December 2004 reporting, or continue to report the Form C1. However, once the subsidiary has elected to move to Form CE, they will not be able to revert back to the Form C1 and must continue to report the Form CE going forward. Non UK-owned bank subsidiaries will continue to complete the C1.
Reporting of Form CE will follow the same reporting schedule of Form C1. All banks affected by these changes have already been contacted separately.
Copies of the new Form CE, its definitions and validations are attached. The technical specification for the electronic reporting of the Form CE for reporting banks and recognised software houses, along with a Form CE divider for the Yellow Folder, will be available in March. Should you have any queries relating to the new form, please contact Vicki Black (Tel. 020 7601 5573).
7. Changes to Forms B1 and C1 (effective end-December 2004 reporting)
The proposed enhancements from the BIS also have a small impact on Forms B1 and C1, from end-December 2004 reporting. The definition changes that have been implemented on the Form CE also need to be reflected in Forms B1 and C1. The main areas of note are:
- A change in the valuation method for the banking book, to be valued at face value or cost price.
- A change in the treatment for banking International Organisations, to be classified as public sector as opposed to banks on the current Form C1. Credit derivatives and collateral recognised as risk mitigants and therefore included within risk transfer items.
- Risk transfers on the Form C1 include both cross border claims plus non-UK offices non-local currency claims on local residents and local currency claims on local residents. Currently local currency claims on local residents are not included in the reporting of risk transfers.
We have attempted to make the definitions for completing the form as clear as possible and included examples where practical to help assist your understanding. This has resulted in a significant rewrite of the definitions. However, much of the content is still the same and we have highlighted where the definitional changes occur. Also, where relevant, we have amended the Classification of Accounts Guide.
Copies of Forms B1 and C1, their definitions (B1, C1) and validations (B1, C1) are attached for insertion in the Yellow Folder. Should you have any queries relating to these changes, please contact Vicki Black (Tel. 020 7601 5573).
Printed copies of Forms B1, C1 and CE will be available shortly, and a small supply will be sent to those reporters who submit their data on paper. However, if you submit electronically but would like a copy of the forms please contact Sarah Waddington (Tel.020 7601 5505).
8. Contents page for Yellow Folder (update)
Attached.
Bank of England
Monetary & Financial Statistics Division
5 February 2004
