• Login
    Your ProfileLogout
  • join
  • about reply
Avantage Reply Logo
Menu
  • About Us
    About Us
    • About Us
    • History
    • Our Approach
    • Values
    • Alumni
    • Strategic Partners
    • Media Contacts
    • Contact Us
  • Our Capabilities
    Our Capabilities
    • Our Capabilities
    • Risk
    • Finance
    • Conduct & Compliance
    • Technology
  • Newsroom
    Newsroom
    • Newsroom
    • News
    • Events
    • Press Articles
    • Blog
    • Academy
  • Publications
    Publications
    • Publications
    • Briefing Notes
    • White Papers & Practical Guides
    • Case Studies
    • CRO Insights Journals
  • Career
    Career
    • Career
    • BELGIUM
    • FRANCE
    • ITALY
    • LUXEMBOURG
    • NETHERLANDS
    • UK
  • about Reply
  • join
Avantage Reply Logo

Search

Case Studies

Case Study

ECB’s forward-looking regulatory requirements and expectations

FOCUS ON: Case studies,

SUMMARY

Avantage Reply assisted one of the largest banks in Luxembourg, in continuing to address the European Central Bank’s (ECB) supervisory expectations in an effective and proactive manner. Avantage Reply’s added value relied on a benchmarking analysis against peer firms in Eurozone, enabling the bank to better understand the forward-looking regulatory requirements that the Bank should comply with.

CUSTOMERS GOALS

The primary goal of the client was to improve on a range of issues of the Supervisory Review and Evaluation Process (SREP), which have gradually decreased client’s ratings over the years, while refining its supervisory dialogue with the ECB.

Client also requested a peer benchmarking evaluation as well as a forward-looking view of what the bank should expect from the ECB and local regulator in the upcoming years.

THE CHALLENGE

The high number of reports, generated by the compliance and risk department, combined with the difficulty to access those who slow down the analysis of the bank. Additionally, the lack of centralization of the document made it difficult to consult the relevant material in timely manner.

Very limited availability of the banks’ employees when organizing meetings on a short notice added difficulty to the project.

In most occasions, the information needed was quite hard to extrapolate, since the banks’ employees were not recognizing the existence of an issue to be addressed in the fist place.

APPROACH AND SOLUTION

To achieve the objectives defined by the client, the following steps were performed:

1. Multiple interviews with the three different streams: Governance, ICAAP/ILAAP, and Data & Reporting:

  • Identified the current issues of each department in relation to the findings of the SREP letter
  • Described the above in a structured and consolidated way, to deeply examine what elements were missing or not performed well in relation to the expectation of the regulator;

2. Benchmarking exercise taking into account peer banks to:

  • Perform a detailed analysis to identify the current position of the client compared to its peers
  • Identify which issues where tackled and the ones that are not, so that to give an idea of whether the bank would need instant changes
  • 3. A detailed analysis of the relevant regulations affecting the bank have been fully analyzed and proposed in the final report:

    • CRD 5 / CRR 2 updates
    • PSD2
    • IFRS 17
    • Securities Financing Transaction Regulation
    • FATF 2020 inspection

RELATED CONTENTS

Case Study

IRRBB – Support the transition of the IRRBB metrics computation tool and reconciliation exercise between both outcomes regarding EVE (Economics Value of Equity) and NII (Net Interest Income).

The Client, a huge international bank, request the support of Avantage Reply to further understand and quantify the differences arising between both of their IRRBB metrics calculators. The first, is a hand-made tool provided by the headquarter and the second is a well-known risk software solution used locally. Avantage Reply helps isolating and assessing each of the differences, and in case of materiality, set processes in order to compute overlays. Avantage Reply further helps to add and validate missing products. Validations cover parametrization of the tool, alinement of IRRBB inputs (margin and reference rate) and models (non-maturing products, prepayment, caps, floors,..)

Case Study

IFRS 9 Control Framework

The customer is a retail belgian bank focusing on mortgage loans and consumer credit. Following the implementation of the IFRS 9 ECL calculator, the need arised to implement a control framework to ensure timely and quality calculation and bookings, and integration in the accounting and reporting platforms. Avantage Reply helped the client bridge the distance between different departments to identify the right responsibilities at the right moment in the process to increase its reliability.

Case Study

Internal Audit Co-Sourcing - COREP

The customer is a strong financial player present worldwide providing services in banking sector and insurance. The goal of the project was to conduct a co-sourcing Internal Audit on Common Reporting (Corep). Avantage Reply provided the client with a tailored assistance to its specific needs bringing its expertise and knowledge in order to perform high quality assessment of Corep governance processes.

 ​
 
 
 
Reply ©​​ 2021 - Company Information
  • Abou​t Reply​​
  • Investors​​​
  • Newsroom
  • Follow Reply on
  • ​
​
  • ​About Avantage ​​Reply
  • Privacy Policy
  • Information (Client)​
  • Information (Supplier)
  • Information (Candidate)