Featured Product

    BCBS Gauges Progress on Implementation of Data Aggregation Principles

    April 29, 2020

    BCBS published the latest progress report on implementation of the BCBS 239 principles, also known as the Principles for effective risk data aggregation and reporting, by banks. The report reviews progress of 34 global systemically important banks (G-SIBs) in implementing the principles as of the end of 2018, with the assessment having been completed before onset of the COVID-19 pandemic. The assessment concludes that none of the banks are fully compliant with the principles in terms of building up the necessary data architecture and, for many, IT infrastructure remains difficult. However, banks' efforts to implement the principles have resulted in tangible progress in several key areas, including governance, risk data aggregation capabilities, and reporting practices.

    Despite the improved overall performance, no bank has been assessed as fully compliant with all the principles in this assessment. This contrasts with the 2017 assessment exercise, in which three banks had qualified for the rating of “4” (the highest rating) for all principles. Increased awareness among banks has resulted in better in-depth analysis and this, together with the expanded scope of projects aimed at implementing the principles, partially explains the ratings downgrades. Many banks have expanded their implementation scope beyond risk data management to incorporate strategic initiatives—including regulatory reporting, financial reporting, and recovery and resolution planning—into their BCBS 239 implementation programs. Supervisors observed notable improvements in banks’ overarching governance, risk data aggregation capabilities, and reporting practices. In particular, banks have:

    • Established enterprise data strategies and data management frameworks and appointed relevant governance committees and managers for key roles in data management (such as data-owners and -stewards) to improve data oversight
    • Improved data dictionaries, which is a key aspect of Principle 3, enterprise data quality metrics, and data lineage
    • Enhanced quality assurance, allowing identification and correction of data quality issues
    • Initiated automated reporting platforms, which strengthen ad hoc reporting capabilities
    • Established group-level reporting policies, which set out the periodicity and dissemination of reports

    As per the progress report, the reasons why banks have been unable to effectively implement the Principle 2 on data architecture and IT infrastructure have not changed drastically over the years. Banks have unaligned IT solutions and legacy systems, which hamper reconciliations of risk data. This hinders banks from producing accurate reports with sufficient granularity to meet ad hoc data requests. This also explains the challenges faced by banks in implementing Principles 3 (accuracy and integrity), 5 (timeliness), 6 (adaptability), and 7 (accuracy). Appendix 2 to the report provides more detailed examples of effective and ineffective practices among banks for implementing the Principles. BCBS will continue to monitor the progress of G-SIBs in adopting the principles. Nevertheless, to promote full adoption of the Principles, the Committee has made the following recommendations: 

    • Banks should continue to closely monitor their implementation of the principles, adapting them as necessary to take into account any changes in the financial sector. Banks that have struggled to implement the principles should address weaknesses promptly, which may include committing the resources needed to complete data architecture and IT infrastructure improvement projects. 
    • Supervisors should continue to monitor the progress made by banks in implementing the principles. Supervisors should also take appropriate measures to address delays and ineffective implementation


    Related Links

    Keywords: International, Banking, Reporting, Data Aggregation, BCBS 239, Progress Report, G-SIBs, Statistical Reporting, BCBS

    Featured Experts
    Related Articles

    US Agencies Issue Regulatory Updates, FDIC Launches Tech Sprint

    The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.

    January 13, 2022 WebPage Regulatory News

    EBA Issues Guide on Bank Resolvability, Consults on Transferability

    The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).

    January 13, 2022 WebPage Regulatory News

    HKMA Extends Repayment for Trade Facilities, Consults on Crypto-Assets

    The Hong Kong Monetary Authority (HKMA) published a circular, along with the reporting form and instructions, for self-assessment, by authorized institutions, of compliance with the Code of Banking Practice 2021.

    January 12, 2022 WebPage Regulatory News

    FCA Registers Securitization Repositories; PRA Issues 2022 Priorities

    The Financial Conduct Authority (FCA) decided to register European DataWarehouse Ltd and SecRep Limited as securitization repositories under the UK Securitization Regulation, with effect from January 17, 2022.

    January 12, 2022 WebPage Regulatory News

    EC Regulation Sets Out Methods for Measuring K-Factors Under IFR

    The European Commission (EC) published the Delegated Regulation 2022/25, which supplements the Investment Firms Regulation (IFR or Regulation 2019/2033) with respect to the regulatory technical standards specifying the methods for measuring the K-factors referred to in Article 15 of the IFR.

    January 11, 2022 WebPage Regulatory News

    BIS Studies How Platform Models Impact Financial Stability & Inclusion

    The Bank of International Settlements (BIS) published a paper that assesses the ways in which platform-based business models can affect financial inclusion, competition, financial stability and consumer protection.

    January 10, 2022 WebPage Regulatory News

    ESAs Publish List of Financial Conglomerates for 2021

    The European Supervisory Authorities (ESAs) published the list of identified financial conglomerates for 2021.

    January 07, 2022 WebPage Regulatory News

    APRA Licenses Two More Banks, Reduces Committed Liquidity Facility

    The Australian Prudential Regulation Authority (APRA) updated the list of authorized deposit-taking institutions, granting license to Barclays Bank PLC and Crédit Agricole Corporate and Investment Bank to operate as foreign authorized deposit-taking institutions under the Banking Act 1959.

    January 07, 2022 WebPage Regulatory News

    EU Issues SII Corrigendum; EIOPA Assesses SII Reporting Exemptions

    EU published, in the Official Journal of the European Union, a corrigendum to the Delegated Regulation 2015/35, which supplements Solvency II Directive (2009/138/EC).

    January 06, 2022 WebPage Regulatory News

    EBA Opines on Impact of De-Risking and Associated AML/CFT Challenges

    The European Banking Authority (EBA) published an Opinion on the scale and impact of de-risking in European Union and the steps that competent authorities should take to tackle unwarranted de-risking.

    January 05, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 7860