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Risk aggregation and reporting challenges intensify for banks 

June 9, 2014
Steve Culp (Accenture), Banking Tech

The past month has been a busy one for G-SIBs – global systemically important banks – as they confront the challenges of “what full compliance looks like” in the context of the Basel Committee on Banking Supervision and its Principles for Effective Risk Data Aggregation and Risk Reporting, writes Steve Culp.

In late December 2013, BCBS published its progress report summarising G-SIBs’ preparedness to comply with those principles and the challenges they face as pursuit of full compliance continues in light of the January 2016 deadline.

The results of that progress report, industry-level discussions (e.g. via the Institute of International Finance), and conversations occurring at G-SIBs within risk management and finance divisions confirm that the journey to 2016 is fraught with enormous challenges. BCBS suggested that some bank self-assessment submissions were a bit too rosy and not consistent with Basel III principles. Furthermore, BCBS cautioned that some banks may have overstated their progress.

Furthermore, one-third of surveyed banks said they would not meet the deadline, although many are in the midst of large multi-year risk and finance IT transformation projects designed to bring them in compliance with Basel III.

Read more: Banking Technology

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