Regulator-facing remediation documentation

We helped our client respond to a regulatory audit by documenting their end-to-end process, control and ownership focusing on EU and US credit and capital processes with regard to IRBA securitisation

The challenge

The European Credit Requirements Directive (CRD) regulation stipulates that organisations must have a clearly communicated and transparent organisational structure, clear lines of responsibility and effective processes to manage, monitor and report the risks they are exposed to. Satisfying this requirement involved thorough research and investigation of existing policies and procedures, discussion with involved stakeholders and interested parties, from front-office through to group level reporting.

As is often the case, our client lacked consistent top-level reference documentation that illustrated their complete end-to-end processing, control and ownership of a particular business discipline, largely because of the siloed nature of their operations, and insulated nature of hand-offs.

Our approach

We undertook exhaustive research and investigation in order to create a single reference document that positioned the firm’s operations in a compliant, regulatory-facing manner. This included:

  • the definition of simplified end-to-end process covering credit, capital, quality control, remediation and governance activities;
  • clearly communicated sub-activities, ownership, timing and control elements for each end-to-end process step;
  • clear top-down versus bottom-up governance and management arrangements, and the relationships between them; and
  • summarised participation and control matrices for every step; from origination and structuring to capital regulatory reporting.

Our impact

Adopting the actual regulatory text as a guiding principled enabled the production of a relevant an comprehensive document, detailing all activities in context to what the regulation was asking for. Enveloping our delivery was a clearly defined ownership matrix, which also supported the validation of future updates.