Central Bank of Ireland Publishes Systemic Risk Pack in March 2019
Central Bank of Ireland published the Systemic Risk Pack, which presents the bank's approach, including indicators and visualization methods, for monitoring systemic risk in the Irish financial system. The systemic risk pack includes a set of summary heatmaps and a selection of noteworthy or topical charts for consideration. While the heatmaps provide a useful overview of the systemic risk landscape, they are also a very simple risk assessment tool. For example, they do not take into account dynamics in the broader financial system or real economy which will determine whether or not an indicator’s level can be considered excessive or unstable.
In the systemic risk pack, explanation of indicators used is provided for each section in the form of a glossary and metadata table. The heatmaps aim to distill information and highlight areas of elevated risk by color coding indicators in line with their deviation from levels associated with financial system stability (thresholds). The indicators presented in the systemic risk pack are drawn from the broad range of data available to the Central Bank of Ireland. These include publicly available data as well as commercially sourced data supplied by third parties and data reported by regulated entities. The approach that has been taken to develop the risk pack makes it a very flexible tool and will allow for it to evolve over time, as new data sources become available, other relevant indicators are identified, and approaches to data visualization evolve.
This publication builds on the existing work regarding the use of macro-prudential indicators in policy setting. This biannual publication is created to facilitate macro-prudential analysis and to focus policy maker discussion. It complements the existing financial stability analysis by providing a comprehensive systemic perspective, along with the detailed approach provided in other publications.
Related Link: Systemic Risk Pack (PDF)
Keywords: Europe, Ireland, Banking, Systemic Risk, Macro-Prudential Policy, Financial Stability, Risk Assessment Tool, Central Bank of Ireland
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Pierre-Etienne Chabanel
Brings expertise in technology and software solutions around banking regulation, whether deployed on-premises or in the cloud.
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Previous Article
FCA Publishes Findings from Consumer Research on Crypto-AssetsRelated Articles
BIS Examines Use of Big Data and Machine Learning at Central Banks
BIS published a paper that provides an overview on the use of big data and machine learning in the central bank community.
APRA Finalizes Reporting Standard for Operational Risk Requirements
APRA finalized the reporting standard ARS 115.0 on capital adequacy with respect to the standardized measurement approach to operational risk for authorized deposit-taking institutions in Australia.
ECB Publishes Guide for Determining Penalties for Regulatory Breaches
ECB published a guide that outlines the principles and methods for calculating the penalties for regulatory breaches of prudential requirements by banks.
MAS Sets Out Good Practices to Manage Operational Risks Amid COVID
MAS and The Association of Banks in Singapore (ABS) jointly issued a paper that sets out good practices for the management of operational and other risks stemming from new work arrangements adopted by financial institutions amid the COVID-19 pandemic.
ACPR Announces New Data Collection Application for Banks and Insurers
ACPR announced that a new data collection application, called DLPP (Datalake for Prudential), for collecting banking and insurance prudential data will go into production on April 12, 2021.
BCB Maintains CCyB at 0%, Initiates First Cycle of Regulatory Sandbox
BCB announced that the Financial Stability Committee decided to maintain the countercyclical capital buffer (CCyB) for Brazil at 0%, at least until the end of 2021.
EIOPA Launches Study on Non-Life Underwriting Risk in Internal Models
EIOPA has launched a European-wide comparative study on non-life underwriting risk in internal models, also kicking-off of the data collection phase.
SRB Publishes Overview of Resolution Tools Available in Banking Union
SRB published an overview of the resolution tools available in the Banking Union and their impact on a bank’s ability to maintain continuity of access to financial market infrastructure services in resolution.
EBA Consults on Pillar 3 Disclosure Standards for ESG Risks Under CRR
EBA is consulting on the implementing technical standards for Pillar 3 disclosures on environmental, social, and governance (ESG) risks, as set out in requirements under Article 449a of the Capital Requirements Regulation (CRR).
ESAs Issue Advice on KPIs on Sustainability for Nonfinancial Reporting
ESAs Issue Advice on KPIs on Sustainability for Nonfinancial Reporting
