Five tips to simplify your regulatory reporting process


Few banks and financial institutions can say that they have complete confidence in their regulatory reporting processes, or that they do not view compliance as a tedious and costly affair. Most banks, especially small and medium-sized ones, are constantly between a rock and a hard place when it comes to dealing with compliance. On the one hand, the race to meet the evolving demands of regulators can become quite tedious. But on the other hand, if banks fail to meet their regulatory standards, they risk accumulating heavy penalties and losing the trust of their regulators and the general public.

Banks and financial institutions have a wide range of third-party reporting solutions at their disposal to meet their reporting needs, but there is still a considerable amount of manual and tactical processes, which are carried out pre-build and post-build. reports. . There seems to be a Herculean task in getting regulatory reports on time without any possibility of errors to bypass the possibilities of loss of reputation and credibility for institutions.

Challenges of regulatory reporting

1. Gaps in the preparation and adjustments of regulatory data

Analyzing the data information needs of regulatory schedules and models can be a long and difficult process. Most of these would be available in the bank relational data store, but there might be a few that might require exploration on a data lake or upstream systems. Banks are currently hiring their Business DataAnalysts to do this, but it can be an extremely painful exercise, which could be more effective with some acceleration.

2. Authentication of data captured outside of the transaction

Interpreting regulatory reporting guidelines is a very demanding and intellectually engaging task, with financial institutions spending significant time, effort and resources to ensure that they are not arrested for non-compliance or that MRAs publish their regulatory submissions.

Even with advancements in computer technology and applications, in most financial institutions some data is still entered into final reports through manual intervention due to business process limitations. Most non-automated tactical feeds are adjustment numbers, which are sent to regulatory teams via spreadsheets and encompass field-level information that exists outside of the captured transactional data. A multitude of third-party systems must be referenced for reconciliation. Although over the years the controls established over these processes have evolved, these non-automated feeds are still widespread and take extremely long to process.

3. Build your audit trail of the information captured

Kyzer TFRS doesn’t just send reports to regulators; it takes control of the entire reporting process from the time a transaction is updated until the report is submitted, reviewed and accepted. It can combine data from multiple sources, format reports ready for regulators under several different regulations, receive and ingest responses from regulators, make simple field-by-field changes, maintain audit trails, and more. in just a few clicks. TFRS is fully exception-based, enabling streamlined, low-risk, and high-precision reporting. Audit trails – all audits are stored and accessible at any time throughout the reporting process and for archiving.

4. Process based on minimal manual intervention

The recommendation to take advantage of various data extraction methods customized according to the policies of the bank, the main and allied systems, which can read and analyze the data attributes in the upstream systems and recommend the probable mapping of the element source to the target fields of the maintained data model for the respective regulatory reports.

Although this process cannot be fully automated initially, the algorithms over time, with feedback and validation of regulatory responses, aim to gain precision and further speed up this process over time. This will significantly speed up the data preparation and adjustment process and allow the regulatory team more time to analyze the reports.

5. Retention of data for resubmissions if necessary

Gap analysis is an important regulatory reporting process to ensure that there are no major deviations in reporting from one submission to another and even if there are deviations, l The financial institution is aware of this and can attribute it to a known business factor. Even though the scanning process itself does not take much time, it should be very diligent with little or no risk of errors.

Business users of regulatory reporting teams are required to create a management summary report both for review by the internal management team and for review by regulators. And depending on the sensitivity of the data, a public, private or hybrid cloud can be used to host the regulatory reporting infrastructure.

Goals at all times should not only be reducing compliance costs, but also ensuring that regulatory transformation is aligned with the company’s business strategy, and also making the regulatory infrastructure agile enough to meet any demand. additional regulations, make the business sustainable as much as possible.



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The opinions expressed above are those of the author.



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