Next month, industry practitioners will have four opportunities to provide feedback to the Committee of European Banking Supervisors (CEBS) on its risk related proposals, including those around concentration risk and stress testing. The regulatory body has organised four separate hearings at its London premises to garner feedback on a number of its recent consultation papers, all of which involve technology and systems considerations.
There is a clear need within the counterparty risk manager community for more tools and better access to data related to credit risk analytics, according to Jonathan Di Giambattista, managing director of risk and performance analytics at Fitch Solutions. Di Giambattista bases his judgement on a recent survey of 85 counterparty risk managers in buy side firms carried out in October last year by the solutions provider owned by ratings giant Fitch.
The UK Financial Services Authority (FSA) has indicated that is "disappointed" by the "unclear articulation" of firms’ risk appetites in the Internal Capital Adequacy Assessment Process (ICAAP) submissions it has received from investment firms so far. The regulator indicates that these firms should bear a number of factors in mind when preparing for their next submissions, including providing the right level of risk related data in order to the FSA to be able to accurately judge their risk management capabilities.
The Committee of European Banking Supervisors (CEBS) was originally established as a forum to lead the charge towards a new Basel framework but in recent years it has become increasingly focused on the practical realities of risk management. Giovanni Carosio, deputy director general of the Bank of Italy who took over the reins as chairman of CEBS last September from Kerstin af Jochnick, recently elaborated on the regulatory body’s changing role and the position it feels the European Banking Association (EBA) should adopt in the building of a new IT infrastructure for regulatory data exchange in Europe.
Stress testing and its many related data and technology challenges were the talk of this month’s FS Club. Attendees agreed with the motion by chair and JWG-IT CEO PJ Di Giammarino that stress testing is a killer for banks operating in the UK faced with the Financial Services Authority’s (FSA) new liquidity risk reporting regime.
Following on from its “Dear CEO” letter sent out earlier this month (see our coverage 
A-Team Insight Exchange is a new event series for 2010, which will combine A-Team’s expertise in financial markets IT with thought leadership from world-class technology innovators and practical experience from financial market practitioners.
The introduction of new global liquidity risk management reporting requirements could result in potentially negative unintended consequences such as making it too expensive to lend, according to a group of 150 financial institutions. The comments have been prompted by the publication of the Basel Committee on Banking Supervision (BCBS) recommendations on liquidity risk at the end of last year and the related consultation period, which is due to end this week. A number of global financial institutions have taken the opportunity to provide their feedback on the proposals and indicated that they believe them to be based on incorrect assumptions and potentially very costly for the industry as a whole.
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