Featured Product

    Sabine Lautenschläger of ECB Speaks About Overcoming Data Shortcomings

    July 10, 2018

    Sabine Lautenschläger of ECB spoke at the Ninth ECB Statistics Conference in Frankfurt. She talked about the importance of big data and the projects put in place to overcome shortcomings in data before the global financial crisis. In this context, she focused on the Banks’ Integrated Reporting Dictionary (BIRD), money market statistical reporting (MMSR) project, and AnaCredit project of ECB.

    She stated that ECB started to collect MMSR data in 2016. The MMSR data include trade-by-trade granular data on four market segments. ECB receives full information on each trade—the maturity date, the rate, the counterparty, the collateral, and more. Data on the unsecured market segment are published every six to eight weeks. With this project, ECB took an important step toward the future, becoming a collector of “big data.” However, this was not done alone. The MMSR project involved the central banks of four countries—Germany, France, Italy, and Spain—and ECB. These institutions needed to cooperate with reporting banks. Cooperation happens not only between institutions, but also within institutions: the constant feedback loop between departments using the data and those preparing them leads to high-quality results. Cooperation also helps us to make reporting more efficient, which in turn reduces the burden on banks, said Ms. Lautenschläger .

    ECB has worked on two fronts. With the ESCB Integrated Reporting Framework, the aim is to aggregate and harmonize reporting requirements of banks. With the Banks’ Integrated Reporting Dictionary (BIRD), banks are supported in organizing their data with a view to reporting it more efficiently. To this end, experts from national central banks work with experts from commercial banks to define the data and data transformations needed to comply with the reporting requirements for AnaCredit and the Securities Holdings Statistics. Therefore, banks that choose to participate are being helped to do a job they would otherwise have had to do on their own. She also highlighted that big data has brought tools and techniques that can be applied to rapidly process large sets of traditional data too. This makes it much easier to realize projects such as MMSR and AnaCredit.

    AnaCredit, for instance, involves immense sets of extremely granular data, reflecting the far greater complexity and interconnectedness of today’s economy. To understand this complexity and assess the interconnections, a very detailed view is needed. This is exactly what AnaCredit gives. Thanks to the granular data it provides, ECB will be better able to understand what is driving credit growth, making it easier to know whether such growth is healthy or not. MMSR, on the other hand, is about speed: money markets move fast and never stop. So taking a snapshot every now and then does not suffice. Much faster data is needed and that is what MMSR provides. It allows us to constantly assess who lends how much money to whom in the money market and at what rates. This gives a very clear and quick picture of how the market is structured, how exposed players are to one another, and how vulnerable they are.

    In short, during her speech, she focused on key ingredients that have been crucial in building up the good reputation of ECB over the past 20 years. The first ingredient is to have good data and to use them well when making decisions. The second is to ensure good cooperation and the third is to keep pace with the changing times.

     

    Related Link: Speech

    Keywords: Europe, EU, Banking, Reporting, Big Data, BIRD, MMSR, AnaCredit, ECB

    Featured Experts
    Related Articles
    News

    APRA Consults on Reporting Standard for Credit Risk Management

    APRA is consulting on the reporting standard for credit risk management (ARS 220.0).

    October 28, 2020 WebPage Regulatory News
    News

    Regulators Fine Goldman Sachs for Risk Management Failures

    FCA and PRA in the UK, FED in the US, and the authorities in Singapore have fined Goldman Sachs for risk management failures in connection with the 1Malaysia Development Berhad (1MDB).

    October 23, 2020 WebPage Regulatory News
    News

    ISDA Launches IBOR Fallbacks Supplement and Protocol

    ISDA launched the IBOR Fallbacks Supplement and the IBOR Fallbacks Protocol, with both becoming effective on January 25, 2021.

    October 23, 2020 WebPage Regulatory News
    News

    Canada Hosts International Conference of Banking Supervisors

    BCBS announced that OSFI and the Bank of Canada hosted the 21st International Conference of Banking Supervisors (ICBS) virtually on October 19-22, 2020.

    October 22, 2020 WebPage Regulatory News
    News

    FCA Proposes More Measures to Help Insurance Customers Amid Crisis

    FCA proposed guidance on how firms should continue to seek to help customers who hold insurance and premium finance products and may be in financial difficulty because of COVID-19, after October 31, 2020.

    October 21, 2020 WebPage Regulatory News
    News

    EBA Issues Opinion to Address Risk Stemming from Legacy Instruments

    EBA issued an opinion on prudential treatment of the legacy instruments as the grandfathering period nears an end on December 31, 2021.

    October 21, 2020 WebPage Regulatory News
    News

    ESRB Publishes Non-Bank Financial Intermediation Risk Monitor for 2020

    ESRB published the fifth issue of the EU Non-bank Financial Intermediation Risk Monitor 2020 (NBFI Monitor).

    October 21, 2020 WebPage Regulatory News
    News

    HM Treasury Publishes Policy Statement Amending Benchmarks Regulation

    HM Treasury announced that the new Financial Services Bill has been introduced in the Parliament.

    October 21, 2020 WebPage Regulatory News
    News

    APRA Initiates Action Against a Bank for Liquidity Compliance Breach

    APRA announced that it has increased the minimum liquidity requirement of Bendigo and Adelaide Bank for failing to comply with the prudential standard on liquidity.

    October 21, 2020 WebPage Regulatory News
    News

    European Council Adopts Position on Capital Markets Recovery Package

    Ambassadors of EU member states agreed on the mandate of European Council on the Capital Markets Recovery Package, to support economic recovery from the COVID-19 crisis.

    October 21, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 6011