FIN-FSA updated the "Regulations and guidelines 8/2014" on management of operational risk by supervised entities. The Regulations and guidelines 8/2014 will enter into force on January 01, 2020. These regulations and guidelines concern the principles and organization of operational risk management, covering the topics of process management, staff, information and payment systems, information security, continuity planning, and legal risk. Among others, the updates have been made in incident reporting concerning network and information security breaches and fraud reporting concerning payment services.
The objective of these regulations and guidelines is to ensure that the following steps are taken:
- The supervised entity organizes its operational risk management to fulfill requirements determined by the scope and character of its operations.
- If necessary, the risk management tasks may be outsourced in compliance with the FIN-FSA regulations and guidelines 1/2012 on outsourcing.
- The supervised entity ensures an appropriate level of information management, information security, and continuity of operations.
- FIN-FSA is informed of significant disruptions and faults in the entity's operations and other impairments as well as losses due to realizations of operational risk.
The amendments to the regulations and guidelines are due to Directive 2016/1148 on security of network and information systems (NIS), Article 96(6) of the reformed Payment Systems Directive (PSD2) (EU) 2015/2366, Article 33(6) of Regulation (EU) 2018/389, Guidelines of EBA on fraud reporting (EBA/GL/2018/05), and on the conditions to benefit from an exemption from the contingency mechanism under PSD2 (EBA/GL/2018/07). Through these amendments, FIN-FSA provides more specific regulations and guidelines for incident reporting under the NIS Directive. The regulations and guidelines also communicate to supervised entities certain EBA guidelines which should be taken into account by the supervised entities in their activities.
Effective Date: January 01, 2020
Keywords: Europe, Finland, Banking, Operational Risk, Outsourcing, EBA, FIN-FSA
Previous ArticleEIOPA Consults on Approach for Regulating Key Aspects of PEPP
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.
The European Banking Authority (EBA) is seeking preliminary input on standardization of the proportionality assessment methodology for credit institutions and investment firms.
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.
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.
The European Banking Authority (EBA) published its annual report on asset encumbrance in banking sector.
The European Banking Authority (EBA) published a methodological guide to mystery shopping.
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.
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.
The Bank of England (BoE) published questions and answers (Q&A) on OSCA to BEEDS migration for statistical reporting as well a presentation from the project overview session held with statistical reporters.
The Basel Committee on Banking Supervision (BCBS) is consulting on a technical amendment to the Basel Framework to reflect a new process reviewing the global systemically important bank (G-SIB) assessment methodology.