Half yearly reporting has been decided upon as the standard for a transparency initiative of the ICMA Covered Bond Investor Council, which has agreed what issuers need to do to be admitted to its platform.

The decisions were taken at a CBIC meeting in mid-October, following a consultation held by the investor group, which aims to finalise its transparency standards by year-end. The meeting focussed on discussing practical aspects of the investor group’s transparency project, with subsequent meetings due to focus on the data fields envisaged by a draft template.

According to a statement from the CBIC, members agreed that only issuers using the group’s template will be allowed to post to a dedicated CBIC webpage, a condition that Nathalie Aubry-Stacey, secretary of the CBIC and director, regulatory policy and market practice at the International Capital Market Association (ICMA), said was key.

“Having one template for all issuers is quite important for the group,” she told The Covered Bond Report. “It is about ease of access via a single webpage but also the comparability of the template.”

The CBIC said that while members recognise that insistence on issuers using its template “could generate additional administrative burden for issuers” they also consider it would help fuel standardisation and “be a great advantage for the European covered bond market and would eventually lower funding cost”.

It was also agreed that the CBIC template – which will take into account responses from the consultation and bilateral discussions with issuers and national associations – be independent from other national templates and be presented in Excel format.

Data should be reported on a half-yearly basis shortly after issuers publish their results, according to the CBIC. Aubry-Stacey said that agreement on this as the desired frequency of reporting was easily reached.

“It should be easy for issuers to do,” she said, “and the emphasis is on data being published quickly after the results so that it is up-to-date.

“Issuers can always decide to publish more.”

Covered bond investor reports, if provided regularly, are generally made available on a quarterly basis, although Spain’s covered bond framework requires disclosure of certain information only on an annual basis, and Bayerische Landesbank, according to Royal Bank of Scotland analysts, has said that it will provide certain cover pool information on a weekly basis, which is above and beyond Germany’s regulatory standards.

The idea of setting minimum reporting standards that issuers need to meet to be able to post to the CBIC website was also discussed, but the group decided against setting such a threshold.

“Although it was agreed that there should be a minimum of policing and that too little relevant information would not be helpful,” said the CBIC, “there would not be any minimum standards.”

Aubry-Stacey said that it is difficult to provide an example of a situation that could require such policing, and that it will be guided by common sense.

“We will have to wait and see what may arise,” she said, “but the key is that we want the templates to be meaningful.

“If, for example, only two data fields are filled in, then what is the point?”

Some market participants have noted that the range of information being sought by the CBIC is extensive, and the CBIC discussed such feedback.

“It was noted that this was expected as it represented the needs of investors and reflected the fragmentation of the European covered bond market – some investors having a focus on the cover pool, others on the general issuer section,” said the CBIC. “It is for each investor to decide what analysis and focus they will take on the data received from issuers.”

According to the CBIC’s statement, its members reiterated that the aim of the transparency project is not to set common definitions for the European covered bond market, but for investors to receive data and explanations behind the data so that they are able to perform their own analysis in a standardised way.

“It was also emphasised that the CBIC never expected all issuers to fill in all the fields – not all information is relevant for all issuers,” it said. “Discussions on a bilateral basis with issuers of the blank fields should hopefully help individual issuers and/or national organisations identifying where to enhance transparency levels incrementally.”

The CBIC will over the coming weeks be holding a series of meetings, either face-to-face or by conference calls, to discuss responses to its consultation, with the number of meetings depending on progress made by national associations on any national templates.

The group is due to meet next with representatives from France’s Compagnie de Financement Foncier, which Aubry-Stacey said had submitted comprehensive and interesting comments to the CBIC as part of its consultation.

“Their response was very constructive, with a national slant,” she said, “and for us it is interesting to get them on board.

“We are still hoping to have the project ready for year-end, and are trying to set up meetings as quickly as possible.”