Featured Product

    Central Bank of Ireland Proposes Guidance on Management of Outsourcing

    February 25, 2021

    Central Bank of Ireland proposed the cross-industry guidance on management of outsourcing risks. The guidance is intended to assist regulated firms in developing their outsourcing risk management frameworks to effectively, identify, monitor, and manage the outsourcing risks. The guidance reminds regulated firms about their statutory obligations on compliance with the existing and future legislation, regulations and about the guidelines relevant to their sector, in respect of the management of outsourcing risk. The consultation period ends on July 26, 2021, post which the Central Bank plans to publish the final guidance in 2021.

    The guidance reaffirms the adoption of the EBA guidelines on outsourcing arrangements and the EIOPA and ESMA guidelines for outsourcing to cloud service providers, for regulated firms that are within the scope of those guidelines.  The central bank deems this guidance relevant to any regulated firm that utilizes outsourcing as part of its business model. The guidance applies equally to intragroup outsourcing arrangements as it does to arrangements with third-party outsourced service providers. Instead of superseding the existing sectoral legislation, regulations, and guidance on outsourcing, the proposed guidance supports and complements these supervisory tools by setting out aspects of good practice for the effective management of outsourcing risk in all its forms. The proposed guidance:

    • Sets out expectations on the governance and management of outsourcing risk, along with the details of the relevant responsibilities of boards and senior management; it also outlines the expectation for regulated firms to consider their strategy and risk appetite in relation to outsourcing and details the elements that should be incorporated in the outsourcing policy of a regulated firm.
    • Highlights the importance of a comprehensive assessment of outsourcing risks and details factors to be considered when assessing and designing controls to manage and/or mitigate a number of key outsourcing risks.
    • Outlines expectations on the management of outsourcing risks in the area of Information and Communications Technology (ICT), including risks arising when outsourcing to the cloud, in addition to presenting the broader measures to be adopted for all critical outsourcing arrangements.
    • Conveys the expectation that regulated firms should undertake appropriate due diligence of outsourced service providers before entering into an outsourcing arrangement and at appropriate intervals during the lifecycle of the arrangement.
    • Emphasizes the importance of regular, comprehensive monitoring of the delivery of the service or function that has been outsourced and the appropriateness of the framework governing and supporting the arrangements.
    • Presents factors that regulated firms should consider when determining whether an outsourced function should be deemed critical or important
    • Specifies the requirements for regulated firms to establish and maintain a register (database) of all outsourcing arrangements and the information (data elements) that such registers should contain; this includes proposal to establish an online regulatory return of the outsourcing registers for submission by regulated firms on a cyclical basis, commencing in January 2022.


    Related Links

    Comment Due Date: July 26, 2021

    Keywords: Europe, Ireland, Banking, Insurance, Securities, Outsourcing Risk, Governance, Outsourcing Arrangements, Cloud Service Providers, ESAs, Central Bank of Ireland

    Related Articles

    OSFI Finalizes on Climate Risk Guideline, Issues Other Updates

    The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.

    March 12, 2023 WebPage Regulatory News

    BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending

    BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.

    March 03, 2023 WebPage Regulatory News

    HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks

    The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.

    March 02, 2023 WebPage Regulatory News

    BCBS Report Examines Impact of Basel III Framework for Banks

    The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.

    February 28, 2023 WebPage Regulatory News

    PRA Consults on Prudential Rules for "Simpler-Regime" Firms

    Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.

    February 28, 2023 WebPage Regulatory News

    DNB Publishes Multiple Reporting Updates for Banks

    DNB, the central bank of Netherlands, updated the list of additional reporting requests and published additional data quality checks and XBRL-Formula linkbase documents for the first quarter of 2023.

    February 28, 2023 WebPage Regulatory News

    NBB Sets Out Climate Risk Expectations, Issues Reporting Updates

    The National Bank of Belgium (NBB) published a communication on climate-related and environmental risks, issued an update on XBRL reporting

    February 24, 2023 WebPage Regulatory News

    EBA Updates Address Securitization Standards and DGS Guidelines

    The European Banking Authority (EBA) published the final draft of the regulatory technical standards that set out conditions for assessment of homogeneity of the underlying exposures in simple, transparent, and standardized (STS) securitizations.

    February 21, 2023 WebPage Regulatory News

    FSB Publishes Letter to G20, Sets Out Work Priorities for 2023

    The Financial Stability Board (FSB) published a letter intended for the G20 Finance Ministers and Central Bank Governors, highlighting the work that FSB will take forward under the Indian G20 Presidency in 2023

    February 20, 2023 WebPage Regulatory News

    ISSB Standards May Become Effective from January 2024

    The International Organization of Securities Commissions (IOSCO) welcomed the confirmation statement by the International Sustainability Standards Board (ISSB) setting out its progress in the development of its first sustainability-related corporate disclosure standards.

    February 17, 2023 WebPage Regulatory News
    RESULTS 1 - 10 OF 8792