Investment Operations

Progress Noted on Implementation of “Principles for Effective Risk Data Aggregation and Reporting”

  • Banks’ ongoing efforts to implement the Risk Data Aggregation Principles have resulted in tangible progress in several key areas.
  • Banks should continue to closely monitor the implementation of the Principles.
  • As of the end of 2018, all banks needed to do further work to be fully compliant with the Principles.

The Basel Committee on Banking Supervision today published its latest progress report on banks’ implementation of the Principles for effective risk data aggregation and reporting. Issued in January 2013, the Principles aim to strengthen banks’ risk data aggregation and risk reporting with a view to improving their risk management, decision-making processes and resolvability.

The progress report is based on the results of a self-assessment survey of authorities with supervisory responsibility for global systemically important banks (G-SIBs). The report reviews G-SIBs’ progress in implementing the Principles as of end-2018.

Covering 34 G-SIBs designated during 2011-19 and completed before the onset of the Covid-19 pandemic, the assessment surveyed recent developments at banks and gathered qualitative information regarding the implementation of the Principles.

According to the report, none of the banks are fully compliant with the Principles in terms of building up the necessary data architecture and, for many, IT infrastructure remains difficult. But banks’ efforts to implement the Principles have resulted in tangible progress in several key areas, including governance, risk data aggregation capabilities and reporting practices.

To promote full adoption of the Principles, the Committee has made the following recommendations:

  • Banks should continue to closely monitor their implementation of the Principles, adapting them as necessary to take into account any changes in the financial sector. Banks that have struggled to implement the Principles should address weaknesses promptly, which may include committing the resources needed to complete data architecture and IT infrastructure improvement projects.
  • Supervisors should continue to monitor the progress made by banks in implementing the Principles. Further, supervisors should take appropriate measures to address delays and ineffective implementation

The Committee said it would continue to monitor G-SIBs’ progress in adopting the Principles.