Featured Product

    EBA Publishes Report on Adoption of Big Data and Advanced Analytics

    January 13, 2020

    EBA published a report that addresses the key considerations in the development, implementation, and adoption of big data and advanced analytics in the banking sector. The report also covers the recent trends in big data and advanced analytics. The report highlights that a data-driven approach is emerging across the banking sector, affecting business strategies, risks, technology, and operations of banks. The report focuses on the big data and advanced analytics techniques and tools, such as machine learning, which is a subset of artificial intelligence; these tools go beyond traditional business intelligence to gain deeper insights, make predictions, or generate recommendations using various types of data from various sources.

    Through its ongoing interaction with the relevant stakeholders and by utilizing its innovation monitoring tools, EBA has observed a fast-growing interest in the use of big data and advanced analytics solutions, with two out of three EU credit institutions already having such solutions in production. All functions across institutions might benefit from the big data and advanced analytics applications, as they could improve existing services from an efficiency, productivity, and cost saving perspective or create new business opportunities. Most institutions are currently using simpler algorithms, leveraging on their core banking data. However, the current landscape can evolve at a rapid pace in the next few years.

    The report identifies data management, technological infrastructure, analytics methodology, and organization and governance as the four key pillars for the development, implementation, and adoption of big data and advanced analytics. The report finds that the roll-out of  big data and advanced analytics affects issues around trustworthiness and notes a number of fundamental trust elements that need to be properly and sufficiently addressed and these cut across the four key pillars. Efforts to ensure that artificial intelligence/machine solutions built by institutions respect these trust elements could have implications for all the key pillars. These trust elements are ethics, explainability and interpretability, fairness and avoidance of bias, traceability and auditability, data protection, data quality, security, and consumer protection. EBA is of the view that additional efforts are needed to ensure that big data and advanced analytics solutions respect and integrate these “elements of trust.” Toward meeting this objective, a risk-based approach could apply on certain “elements of trust,” depending on the impact of each big data and advanced analytics application.

    Going forward, EBA will continue to observe (taking into account other work being done by ESAs and work being done in other international fora) and consider the pace of evolution of big data and advanced analytics in financial services (in line with its FinTech Roadmap). Where appropriate, EBA will accompany this work with opinions and/or proposals for guidelines to achieve a coordinated approach to the regulatory and supervisory treatment of artificial intelligence and big data and advanced analytics activities.

     

    Related Links

    Keywords: Europe, EU, Banking, Big Data, Advanced Analytics, Fintech, Machine Learning, Artificial Intelligence, Fintech Roadmap, EBA

    Related Articles
    News

    EC to Defer Application of SFDR Standards Till July 2022

    The European Commission (EC) announced plans to defer the application of 13 regulatory technical standards under the Sustainable Finance Disclosure Regulation (2019/2088) by six months, from January 01, 2022 to July 01, 2022.

    July 23, 2021 WebPage Regulatory News
    News

    BoE Consults on Approach to Setting MREL, Publishes Bail-In Guidance

    The Bank of England (BoE) published a consultation paper on approach to setting minimum requirement for own funds and eligible liabilities (MREL), an operational guide on executing bail-in, and a statement from the Deputy Governor Dave Ramsden.

    July 22, 2021 WebPage Regulatory News
    News

    EBA Seeks Views on Proportionality Assessment Methodology

    The European Banking Authority (EBA) is seeking preliminary input on standardization of the proportionality assessment methodology for credit institutions and investment firms.

    July 22, 2021 WebPage Regulatory News
    News

    US Agencies Propose Changes to Call Reports and Instructions

    Certain regulatory authorities in the US are extending period for completion of the review of certain residential mortgage provisions and for publication of notice disclosing the determination of this review until December 20, 2021.

    July 22, 2021 WebPage Regulatory News
    News

    PRA Finalizes Rulebook Definition of Higher Paid Material Risk-Taker

    The Prudential Regulation Authority (PRA) published the policy statement PS18/21, which introduces an amendment in the definition of "higher paid material risk taker" in the Remuneration Part of the PRA Rulebook.

    July 21, 2021 WebPage Regulatory News
    News

    EBA Examines Asset Encumbrance in Banking Sector

    The European Banking Authority (EBA) published its annual report on asset encumbrance in banking sector.

    July 21, 2021 WebPage Regulatory News
    News

    EBA Publishes Methodological Guide to Mystery Shopping

    The European Banking Authority (EBA) published a methodological guide to mystery shopping.

    July 21, 2021 WebPage Regulatory News
    News

    APRA Issues Update on Capital Reform Policy Settings for Banks

    The Australian Prudential Regulation Authority (APRA) released a letter to authorized deposit-taking institutions to provide an update on key policy settings for the capital framework reforms, which will come into effect from January 01, 2023.

    July 21, 2021 WebPage Regulatory News
    News

    CPMI-IOSCO Assess Continuity Planning of Market Infrastructures

    The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) published a report that assesses the business continuity planning activities of financial market infrastructures or FMIs.

    July 21, 2021 WebPage Regulatory News
    News

    ESMA Responds to Proposal Related to Sustainability Standards Board

    The European Securities and Markets Authority (ESMA) has responded to the IFRS consultation on targeted amendments to the IFRS Foundation constitution to accommodate an International Sustainability Standards Board (ISSB) to set IFRS Sustainability Standards.

    July 21, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7283