A large global bank needed support to consolidate its regulatory reporting with BCBS 239 (principles for effective risk data aggregation and reporting). Brickendon was called upon to develop a mechanism to support the bank’s attestation to the regulator and provide a robust interpretation of the regulation itself to drive minimum standards of compliance.
The Challenges
- Interpretation: to understand and correctly interpret non-specific regulatory principles to a high level of detail
- Wide scope: the regulation impacted all material entities of the bank and the concept of materiality was not agreed
- Legacy issues: significant problems in relation to fragmentation of the IT application landscape, challenges with data quality for reporting and reference data management
- Lack of consistency: no consistent mechanism to report to the regulator and no minimum standards of compliance for the bank to follow
- Resources: significant resource challenges with respect to budget, headcount and existing internal expertise
- Regulatory conflict: different regulatory agendas (IFRS9, Ring Fencing, FDSF, Senior Managers Regime) competing for the attention of the same senior staff
- Technical support: limited backing for the implementation of a technical solution
- Conflicting priorities: existing focus on remediation work and limited expertise within the bank of the regulatory requirements
The Brickendon Solution
- Develop a process for a consolidated, evidence-based summary of compliance for each principle of the regulation through deep-dive analysis of compliance by risk domain, services, business line and legal entity
- Create a set of minimum standards agreed to by the business lines and a corresponding testing framework
- Embed a culture encouraging the self-identification of issues and close liaison with second- and third-line independent validation teams
- Implement governance forums to ensure the appropriate escalation of, and agreement on, divisive issues
- Implement a proof of concept for tactical technical solutions to support the collation and reporting of the bank’s compliance evidence
- Provide a team of industry experts who are flexible and self-governing to manage ad-hoc queries and provide senior stakeholder advice and consulting on the specifics of the regulation and industry trends
- Provide an open solution, with limited technical burden and embedded self-quality assurance processes, facilitating the handover to low-cost delivery capability
Client Benefits
- Simplification of a complex reporting requirement
- Protection for CRO/CFO roles from the Senior Managers Regime (SMR)
- Scalable and manageable reporting process
- Minimum standards to ensure the bank does enough, but does not over spend on remediation activities
- Clear ownership of remediation activities
- Confidence in the reporting of compliance with non-specific regulation
- A solution which is transferable to all non-specific regulation
To find out how Brickendon can help your business understand the regulatory requirements of BCBS 239, please contact us at [email protected] or call us on +44 (0)203 693 2605
