Addressing regulatory cliffhangers in brazil with innovative technology – axiomsl electricity projects for 4th graders


Brazil’s regulatory eco-system is complex and demanding for all financial market participants. As mandated by the National Monetary Council (CMN), supervised banks and other entities must regularly provide extensive risk and liquidity information to the Central Bank of Brazil (BACEN) and to the Securities and Exchange Commission (CVM). Global systemically important banks (G-SIBs) and international financial institutions doing business in Brazil must acclimate to Brazil’s unique regulatory regime. electricity towers in japan Achieving compliance presents a three-fold challenge.

If the FI lacks a high-performance data-driven technology platform and instead relies on rustic data collection, systems and processes, it will struggle to meet its regulatory requirements. The volumes and velocities of required data, the complexities of aggregation and calculation, and immutable regulatory deadlines and changing requirements will begin to look awfully like the precipices of very high cliffs.

For many FIs operating in Brazil, Resolution 4557 exemplifies these challenges. Basel-III driven, it encompasses liquidity risk and the interest-rate risk in the banking book (IRRBB). z gas ensenada telefono As such, it is complex in scope and detail. The gradual issuance of Circulars and other instructions that dictate required methodologies and measures required for risk monitoring can place supervised entities in a state of suspense — creating a compliance cliffhanger. Circulars 3869 and 3876 are cases in point. Circular 3869

Under Resolution 4557, BACEN establishes minimum quantitative requirements for measuring and monitoring short- and long-term liquidity risk. electricity out The requirements for the liquidity coverage ratio (LCR) are already in place. nyc electricity consumption However, addressing NSFR is a more recent development. In December 2017, BACEN issued Circular 3869, a complex rule that requires aggregating and reporting on very large quantities of data. Despite it taking effect in October 2018, complete details of the NSFR rules were issued only two months before the deadline. electricity 101 presentation With Carta Circular 3900 of August 2018, BACEN provided more information about the report’s layout and submission procedures, including the following timetable.

In the case of Circular 3876, BACEN issued it in January 2018 for effect in November 2018. It provides the calculations and procedures for determining IRRBB, which refers to the risk to the bank´s capital and earnings arising from adverse movements in interest rates impacting the banking book’s outstanding positions. Supervised institutions must report IRRBB using two metrics: economic value (EV) and net interest income (NII), and meet the following deadlines for delivering certain reports.

Recognizing that some of the required data is interconnected across the requirements, they are considering how best to manage to these deadlines. For example, despite some of the reports being due in July 2019, some firms believe they actually need to be fully ready by January 2019. The IRRBB annual disclosure has to be ready in December 2018 (from the as-of-date in December 2017), yet data for that report contributes to deliverables for July 2019. gas stoichiometry practice In general, it is broadly anticipated that BACEN will continue to issue more detailed requirements and procedures in advance of these deadlines. In other words, BACEN 3876 is challenging and shaping up to be another cliffhanger. More Cliffhangers To Come

On the horizon loom more directives. For example, another new Basel-driven regulation is anticipated regarding a simplified alternative to the standardized approach market-risk capital requirements first for the fundamental review of the trading book (FRTB), and then for the market risk standardized approach (SA) x internal model (IMA). These are only a few examples of the regulatory complexity facing financial institutions doing business in Brazil. gas 66 How can firms successfully meet the three-fold regulatory challenge in Brazil: understand, report, and adapt?

AxiomSL’s innovative ‘Platform for Change’ is designed to implement without disruption. Because it is designed to ingest data from disparate sources (no need for data transformation) and for process and reporting transparency (no black-box obfuscation), integrating AxiomSL’s platform and regulatory solutions into the FI’s technology eco-system immediately improves the FI’s overall data management and data governance stance. The FI gains flexibility to meet regulatory requirements, handle change and withstand scrutiny.