XBRL and its uses in a financial institution such as BBVA 13 th XBRL International Conference May 2006
Contents 1. Introduction 2. Scope of XBRL Implementation I. Financial Institutions II. BBVA 3. Summing Up 13 th XBRL International Conference -2 - May 2006
1. Introduction OBJECTIVES • The main objectives to be achieved in this session are: ü Introduction of BBVA. ü New international framework of corporate reporting. ü XBRL creating value in the new framework. ü New opportunities to apply XBRL in Financial Organizations. ü Keys for success in the development of XBRL initiatives. 13 th XBRL International Conference -3 - May 2006
1. Introduction BBVA – GENERAL INFORMATION • First Bank in efficiency in the Eurozone. • Efficiency Ratio : 45. 9% (1 Q 2006). • ROE: 34. 1% (1 Q 2006). • 7, 410 Offices. • 94, 681 Employees. • 34 million euros invested in Training. • Number of Clients: 38. 4 million • 70% Client Satisfaction. • Developing the XBRL Project (BBVA joins the Spanish XBRL Association: September 2004). 13 th XBRL International Conference -4 - May 2006
1. Introduction BBVA – INTERNATIONAL CONTEXT • • • USA (New York, Miami) • Mexico • Cuba • Puerto Rico • Panama • Venezuela • Colombia Spain Portugal Andorra France England • Belgium • Switzerland • Germany • Italy • Russia • • • Peru Chile Argentina Uruguay Paraguay Brazil • Japan • China (Pekin, Shangai, Hong Kong) • Iran 13 th XBRL International Conference -5 - May 2006
1. Introduction EVOLUTION OF DEMAND FOR INFORMATION • Stakeholders’ demand for more information has been evident in the last few years and has been caused mainly by: Outstanding Global Events Changes in Legislation Change of Information Management Model 13 th XBRL International Conference -6 - May 2006
1. Introduction NEW CORPORATE REPORTING REQUIREMENTS • The information requested by the “stakeholders” involves new reporting requirements: ü Transparency ü Accuracy ü Homogeneity ü Increased availability ü Efficiency ü Itemization ü Comparison among competitors ü Support for decision-making 13 th XBRL International Conference -7 - May 2006
1. Introduction GREAT NUMBER OF INFORMATION SENT Global Scope (International) Regulatory Organizations Associations- Other External Agents International Stock Market Local Scope (National/International) Regulatory Organizations National Stock Market Associations- Other External Agents Financial Credit Statistical Others Self. Goverment Communities External Audit City Councils Consulates 13 th XBRL International Conference -8 - May 2006
1. Introduction MAIN REPORTING COMPONENTS Accounting • • Contract/Operations At any Organization level Daily Extended accounting scheme Management mechanism (transfer rates, synergies. ) • Operating Level • Daily, monthly • Movements, positions, attributes, future flows… Reporting Asset Risk and Expected Return Customers • • • Segmentation • Conditions • Statistical data Operating Level Financial Capital Expected Losses Exposure 13 th XBRL International Conference -9 - May 2006
1. Introduction CONTENT OF INFORMATION OUTPUTS • The kind of information periodically delivered to Regulators can be classified in: INFORMATIVE STATISTICAL ü Balance ü P&L ü Relevant facts ü INE ü Regional Communities ü Non Residents Operations - PNR LEGAL MANAGEMENT ü Signed Annual Report ü Companies House Reports ü Normalized files ü External audit BANKING OPERATION TAX ü CIRBE ü ASNEF ü IVA, IRPF e IS Tax models. 13 th XBRL International Conference - 10 - May 2006
1. Introduction DEFICIENCIES IN CORPORATE REPORTING • The main corporate reporting inefficiencies noticed in financial entities, due to the new information management environment: Information Retrieval. 1 Item – N Requests – N Sources Information Validation of heavy processes Working, Analysis. N Presentation Formats Publication. Same information in N presentation formats to N Organizations. 13 th XBRL International Conference - 11 - May 2006
1. Introduction XBRL CONTRIBUTION IN VIEW OF NEW REQUIREMENTS • Due to the new management and information reporting environment: Integrity Quality Optimal Working Reduction of publication cycles Standardization 13 th XBRL International Conference - 12 - May 2006
Contents 1. Introduction 2. Scope of XBRL Implementation I. Financial Institutions II. BBVA 3. Summing Up 13 th XBRL International Conference - 13 - May 2006
2. Scope of XBRL Applications – Financial Entities XBRL AND FINANCIAL ENTITIES Financial / Market Analysts Clients Vendors Financial Organizations Investors Financial Entity Local / International Regulators Software and Technology Vendors Information Administrators 13 th XBRL International Conference - 14 - May 2006
2. Scope of XBRL Applications – Financial Entities VARIETY OF FINANCIAL INFORMATION INTERCHANGE PROCESSES Administrative Information Retrieval Processes Reporting to Official Organizations Retrieval of Market Information International Client Management Risk Management and Analysis Information publication Competitors, Industry, Capital Markets and Subsidiary Analysis Processes Control Processes and Internal Audit 13 th XBRL International Conference - 15 - May 2006
Contents 1. Introduction 2. Scope of XBRL Implementation I. Financial Institutions II. BBVA 3. Summing Up 13 th XBRL International Conference - 16 - May 2006
2. Scope of XBRL Applications - BBVA XBRL INITIATIVES LAUNCHED IN BBVA SIIF Project – Bank of Spain CNMV Project - IPP Retrieval of Market Information COREP (*) Financial information delivery to SEC (*) Risk Analysis and Management Release in BBVA Web (*) Competitor Analysis Capital Market Analysis Industry Analysis (*) In Process 13 th XBRL International Conference - 17 - May 2006
2. Scope of XBRL Applications - BBVA COREP - XBRL Internal Working Sources Calculation Engine Consolidation Standard Internal Basic XBRL BBVA Taxonomy Internal Advanced Consolidated Ratings, Scorings Information Operational Risk Standard XBRL Repository Clients’ Condition XBRL Framework Contract Guarantees COREP 13 th XBRL International Conference - 18 - May 2006
2. Scope of XBRL Applications - BBVA ORGANIZATION • A XBRL Project Office has been created in order to manage and promote internal and external XBRL initiatives to develop in BBVA. External Agents Regulators Suppliers BBVA Areas XBRL Project Office Technology Negotiator between agents Taxonomy Experts Reporting BBVA Systems Data Dictionary User Departments XBRL – BBVA Knowledge XBRL Internal/External Initiatives - SIIF Project - CNMV Project - Capital Laundering - COREP - Others 13 th XBRL International Conference - 19 - May 2006
Contents 1. Introduction 2. Scope of XBRL Implementation I. Financial Institutions II. BBVA 3. Summing Up 13 th XBRL International Conference - 20 - May 2006
3. Summing Up XBRL INITIATIVES – KEYS OF SUCCESS • To achieve success, XBRL initiatives require a mix of the following factors: 1. Publication of more information in XBRL. 2. Development of new XBRL tool functionalities in order to manage XBRL information. 3. Joint performance between Public Administration and the Private Sector. 4. More specifically, in the scope of financial Current Situation organizations, the joint performance of all the participants in the financial system would become necessary to launch new XBRL initiatives. Keys for Success t 13 th XBRL International Conference - 21 - May 2006
3. Summing Up CONCLUSIONS • XBRL is creating value in financial organizations, firstly focused on external reporting and, afterwards, on the internal one. • Nowadays, there are few organizations working in XBRL projects. The main initiatives are the result of Regulators demands. • The commitment of market agents is required for the success and consolidation of XBRL. 13 th XBRL International Conference - 22 - May 2006
13 th XBRL International Conference - 23 - May 2006
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