If your data aggregation processes include extensive manual “data massaging,” you probably don’t perform data aggregation any more frequently than you have to. That will change under BCBS 239, where time is of the essence.
- BCBS 239 Principle 5 states that banks must be able to produce aggregated risk data rapidly during times of stress or crisis.
- BCBS 239 Principle 10 indicates that exposure information should be available immediately, even intraday, in times of stress.
- BCBS 239 Principle 11 indicates reports should be received in a timely fashion.
BCBS 239 Principle 12 gives supervisors the ability to review bank compliance with the principles. This includes ad hoc requests with short deadlines, to test the ability of banks to respond in short timeframes.
Notice a pattern? If your data aggregation includes manual processes, then addressing these items will be painful. But, if you’ve already taken steps to define your terms, implement sound governance, and establish a single, authoritative source for each data set, then you’ll have an easier time responding to fire alarms – both real ones and drills.
Timely response requires automation of manual processes, high scale to address volume processing of information coming from across the organisation, a real time platform (times of crisis never wait for batch processing to wrap up), and efficient processes which eliminate unnecessary steps.
In our post about infrastructure, we indicated that the “minimum necessary” approach won’t work for BCBS 239 compliance. Timeliness is perhaps the most direct reason why this is the case.
Look out for day seven tomorrow.
By Steve Engdahl, SVP, Product Strategy, Goldensource