The Joint Committee of ESAs published the final report analyzing the impact of Big Data on consumers and financial firms. ESAs found that the benefits of Big Data outweigh the potential risks that Big Data pose to financial services consumers. ESAs also published a factsheet on Big Data to inform consumers of financial services about the impact of Big Data. The factsheet provides consumers with the information about the potential benefits and risks of the use of Big Data techniques; it also aims to raise awareness of the measures consumers can take if they experience issues in the use of Big Data.
The report concludes that Big Data brings many benefits for the financial industry and consumers of financial services. These benefits include more tailored products and services, improved fraud analytics, or enhanced efficiency of organizational internal procedures. However, financial services consumers should also be made particularly aware of some of the risks posed by Big Data. The risks identified by ESAs include the potential for errors in Big Data tools, which may lead to incorrect decisions being taken by financial service providers. Additionally, the increasing level of segmentation of customers, enabled by Big Data, may potentially influence the access and availability of certain financial services or products. Nevertheless, ESAs concluded that any legislative intervention at this point would be premature, considering that the existing legislation should mitigate many of the risks identified. This report results from a consultation that was conducted between December 2016 and March 2017. ESAs will continue to monitor developments in this area in the coming years and invite financial firms to develop and implement good practices on the use of Big Data.
Keywords: Europe, EU, Banking, Insurance, Securities, Big Data, Fintech, ESAs
Previous ArticleOSFI Releases Discussion Paper on Reinsurance Framework
The European Commission (EC) published the Delegated Regulation 2021/1527 with regard to the regulatory technical standards for the contractual recognition of write down and conversion powers.
The Australian Prudential Regulation Authority (APRA) published a new set of frequently asked questions (FAQs) to provide guidance to authorized deposit-taking institutions on the interpretation of APS 120, the prudential standard on securitization.
The Single Resolution Board (SRB) published a Communication on the application of regulatory technical standard provisions on prior permission for reducing eligible liabilities instruments as of January 01, 2022.
The Australian Prudential Regulation Authority (APRA) published a new set of frequently asked questions (FAQs) to clarify the regulatory capital treatment of investments in the overseas deposit-taking and insurance subsidiaries.
The European Banking Authority (EBA) published the final report on the guidelines specifying the criteria to assess the exceptional cases when institutions exceed the large exposure limits and the time and measures needed for institutions to return to compliance.
The Prudential Regulation Authority (PRA) issued the policy statement PS20/21, which contains final rules for the application of existing consolidated prudential requirements to financial holding companies and mixed financial holding companies.
The European Banking Authority (EBA) revised the guidelines on stress tests to be conducted by the national deposit guarantee schemes under the Deposit Guarantee Schemes Directive (DGSD).
The European Commission (EC) announced that Nordea Bank has signed a guarantee agreement with the European Investment Bank (EIB) Group to support the sustainable transformation of businesses in the Nordics.
The Hong Kong Monetary Authority (HKMA) issued a circular, for all authorized institutions, to confirm its support of an information note that sets out various options available in the loan market for replacing USD LIBOR with the Secured Overnight Financing Rate (SOFR).
The Office of the Comptroller of the Currency (OCC) issued a new "Problem Bank Supervision" booklet of the Comptroller's Handbook. The booklet covers information on timely identification and rehabilitation of problem banks and their advanced supervision, enforcement, and resolution when conditions warrant.