Managing balance sheet and regulatory requirements across entities and jurisdictions

Managing balance sheet and regulatory requirements across entities and jurisdictions

By Steven Hageman, Chief Liquidity Risk Officer, Societe Generale.

Steven, can you tell the Risk Insights audience about your experience in the industry?

I have worked for two foreign banks over the past 12 years, with a focus on ALM and Liquidity Risk. We saw the significant trends as increasing regulatory requirements and industry-wide best practices. While resources have been increased both in our head office and locally, the pace of change and amount of requirements have dramatically increased. Some progress was made toward global regulatory convergence, but this has slowed.

You will be speaking at the upcoming Risk Americas 2018 to discuss managing balance sheet and regulatory requirements across entities and jurisdictions. Why is this a key talking point in the industry right now?

We have moved in the industry toward global business lines management, yet we have to meet different regulatory requirements. We need to provide business managers with the information needed for decision making, which is quite challenging.

Can you provide a brief overview of some the regulatory requirements that are of focus across 2018?
  • CCAR Asset Size delineation for qualitative phase
  • $50 Billion asset size for SIFI
  • Supplemental Leverage Ratio Changes
  • NSFR US Implementation
What are the key considerations that need to be made when thinking about automating this processes for efficiency?

The amount of reporting required and acceleration of reporting deadlines, have made automation essential. Using the same date base where possible for different liquidity reports, to insure consistency. Appropriate documentation and review of results.

How do you see the risk and regulations industry evolving over the next 6-12 months, particularly in related to the current and upcoming political landscape?

There is a view toward decreasing US regulatory requirements overall, but certain items such as the most recent CCAR economic scenarios can go the other way. Also, the trend toward global regulatory convergence has slowed, as demonstrated by the disparity in NSFR implementation.