CRD IV

EBA’s interactive single rulebook available online

The EBA has published an excellent online tool, cross-referencing all the technical standards to the Level 1 texts and any official Q&A.

To access the “Single Rulebook” click

ALMIS Automates Large Exposure (LE) Reporting – helping firms overcome the increased demands of LE Reporting for COREP

Fact: LE reporting for the new COREP regime is detailed, demanding and complex

Fact: LE reporting now consists of 6 different reports

Fact: Firms should report two different measures of LE

  • Each LE being more than 10% of eligible capital

  • The 10 largest exposures by type, value and maturity

Fact: LE reporting needs to separately show connected groups of counterparties, NACE codes and legal entity identifiers (LEI’s)

This all adds up to a significant reporting burden for any finance department!

Fact: Using ALMIS Capital Adequacy and COREP Reporting can significantly reduce this burden

Firms have previously benefited from using the ALMIS system (Capital Adequacy Module) to monitor, control and report LE. Our enhanced Capital Adequacy and Reporting capabilities give them the power, flexibility and control to automate this process – now even more important to address the more detailed and complex reporting.

Firms need to use the same data to calculate LE as for CR (Credit Risk). The ALMIS system seamlessly integrates and automates CA, CR and LE COREP returns using the Capital Adequacy module. This helps firms by:

  • Saving time and resources

  • Reducing input errors

  • Creating a single consistent version of the data

  • Providing a more comprehensive audit trail

  • Giving confidence to the regulators by using a controlled and integrated solution

For more information on how ALMIS can help reduce your LE reporting burden, contact info@almis.co.uk

Why Synergy matters – getting the best from your ALM and Regulatory Reporting Systems

Back in 1992 when ALMIS International was founded, spreadsheets were very much the norm for calculating balance sheet risk. The need to do calculations at all was a ‘nice to have’ but certainly not an essential part of managing a Building Society. The regulatory financial landscape has changed considerably since then, both in terms of the technology toolbox now available but also in terms of the need for comprehensive, reliable, auditable and reportable analysis.

Building Societies now need to analyse their financial risk profiles in numerous ways, providing their Executives and Boards with accurate information on current and forward looking positions to help them proactively monitor and plan capital and liquidity requirements, profitability and interest rate risk. Not only is this information crucial for managing a sustainable business model it is now part of a complex regulatory regime. ALMIS has provided FSA reporting capability since 2010 but with the implementation of CRD IV and the subsequent demands of COREP and FINREP, the advantages of an IT platform for both ALM and Regulatory Reporting are evident.

The ALMIS regulatory reporting module has been extensively developed to include an effective and time saving solution for FSA, COREP, FINREP and BoE reporting providing effective workflow management, validation routines, comparatives and full audit trails to allow for efficient management and full compliance. But all this reporting data can also be used to monitor and manage financial risks and help manage the balance sheet in a forward looking way.

The new regulations are placing significant strains on finance and treasury departments in Building Societies. As a result, there is a need to be as efficient as possible in how information is processed and interpreted, together with a requirement for consistency with assumptions and data models used to produce the analysis.

Whist some Building Societies have installed a combination of dedicated ALM software for asset liability management and separate regulatory reporting tools, there is a growing trend towards synergy – utilising the same IT platform for both activities. This consolidation of departments and management of regulatory reporting and balance sheet as an integrated activity is proving to be a successful strategy in managing resources and the complexity of data.

The reporting needs of prudential regulators and senior management are not so far apart and the detail of the new regulatory reports now required means that the same regulatory data can be used for balance sheet management purposes.

So the question even for the very largest Building Societies is, “Why have separate, disconnected products for these activities when they can be effectively delivered in one system”?

The advantages of a single system for Balance Sheet Management and Regulatory Reporting:

– A single version of the facts

– Increased scrutiny and therefore reliability within a single version

– Consistency of the assumptions applied

– Time savings loading and reconciling data

– Understanding the impact decisions have and the interplay between liquidity and capital, profitability and interest rate risk

– Building both the regulatory and economic requirements into forward plans

With increasing complexity of data, the growing need for proactive future planning and the continual demands of regulation, the adopters of a system that manages, monitors and reports in a fully integrated and auditable way must surely give those Building Societies a distinct advantage.