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FRM Part I · FRM Exam Part I · Principles for Effective Data Aggregation and Risk Reporting

Under the BCBS 239 principles, which of the following best describes the objective of the principles on risk data aggregation capabilities for a global systemically important bank?

The principles aim to ensure a bank can aggregate risk data accurately and quickly enough to support decision-making, including during stress and crisis. They do not standardize models, mandate outsourcing of data storage or remove management judgment from risk reporting.

  1. AEnsure risk data can be aggregated accurately and quickly enough to support decision-making, including in stress or crisis conditionsCorrect
  2. BStandardize the risk models that every bank uses to calculate regulatory capital
  3. CRequire banks to outsource risk data storage to a single external provider
  4. DReplace management judgment with fully automated risk reports

Explanation

BCBS 239 aims to strengthen risk data aggregation so that boards and senior management get accurate, timely risk information, including in stress and crisis. It does not prescribe models, outsourcing or the elimination of judgment, so those options are wrong.

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