From Compliance to Risk Management: Implementing BCBS 239

The power of regulatory data: making the most of your data with Suade, FIRE and BCBS 239.

The Principles for the effective aggregation of risk data and risk reporting (BCBS 239) published by the Basel Committee on Banking Supervision, helps financial institutions address the shortcomings of their IT systems that resulted in failures of risk management leading up to the global financial crisis. The principles focus on improving governance, data aggregation and risk reporting practices through suitable data architecture and IT infrastructure to generate accurate and reliable risk data. Following these principles provides financial institutions with the tools required to maximise the potential of their data for effective risk management. On top of this, risk controllers can focus on analysis, and spend less time on data collection processes and data quality assurance.

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However, a review from the BCBS indicated that banks are still struggling to comply, as ‘attaining the necessary data architecture and IT infrastructure remains a challenge for many’. One of the areas identified as a concern was the lack of integrated solutions in data aggregation and reporting processes. Legacy technology solutions have struggled to cope with the vast volumes of data processed by banks on a daily basis. As a result, banks have found themselves unable to aggregate their risk data and produce effective reports. Data lineage is a key challenge.

Data gathered in Suade’s automated solution for regulatory reporting can easily be reused to produce both internal and external risk reports and inform risk management decisions. Users of Suade can align with the BCBS 239 principles and produce accurate risk data quickly through the combination of the open-source data standard (FIRE) and an automated solution with a built-in risk engine and powerful data lineage tool.

Strengthening risk data capabilities using Suade not only provides banks with stability but also access to the most granular data, which can be used for better business decisions across the entire bank.

To find out more about how Suade is revolutionising regulatory reporting and driving innovation in financial services, please get in touch.