Transition Indices BMR

Transition Indices BMR

“Our firm’s business consultants work on regulatory projects related to indices, contractual remediation and client interest protection in CIB and retail banking on behalf of various international financial groups.”

During these assignments, they assist the banks’ project teams in the rapid implementation of solutions, using different processes, organizational models and technologies.

THE STAKES

Following the “LIBOR manipulation” scandal sanctioned by $9 billion in fines, the EU Benchmark Regulation (BMR) of 2018 has been fully implemented in 2020. It aims primarily to strengthen the framework and review the calculation of indices as well as benchmark rates, including IBORs (InterBank Offered Rates) or ESTER (to replace EONIA). This major change in the world of interest rates has multiple impacts (client, product, asset-liability management, etc.), in addition to technical issues.

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FRAMEWORK OFFER / FLASH IMPACT ANALYSIS Indices BMR

  • Flash framing
  • Review of risk mapping
  • Mapping of the impacts on the commercial offers and the product catalog
  • Identification of impacts on repository and critical data as, well as their governance, Data Lineage, MDM and Data Quality tools
  • Mapping of impacts on processes and on the company’s body of documentation (Procedures / Policies / Norms and Standards)

OFFER SAFE CONTRACTS & CLIENTS INDICES BMR

  • Identification of the scope of the contracts concerned
  • Stock takeover and creation of riders and standard contracts
  • Implementation scenarios of the contractual transition process, adapted by third party (clients, experts, GA, carrier, etc.) and rearrangement of the standardized contracting
  • Definition of the renegotiation method for impacted contracts
  • Updating of processes and control plans to cover operational risks
  • Definition of the global communication strategy (by stakeholder category)

OFFER TO MANAGE AND IMPLEMENT THE TRANSITION OF  INDICES BMR

  • Framing and definition of the transition program
  • PMO project management: steering and overall governance of the project and functional, organizational and technical monitoring of specific projects. Among others :
  • Assistance in the adaptation/implementation of technical tools
  • Assistance in the creation and updating of documents and reference data
  • Testing of the organization and internal control processes
  • Change management
  • Assessment at 6 months (optional)

SUCCESS STORIES

EXAMPLES OF REFERENCES IN REGULATORY AND TECHNICAL TRANSITION

BPCE: Reporting within the framework of the index reform

  • Creation of an ad-hoc reporting requested by the ECB to present the outstanding amounts indexed to EONIA, EURIBOR, USD LIBOR and GBP LIBOR
  • Data sourcing in line with the production of the FINREP

BNP Paribas : PIC / Claims management

  • Mapping, audit and benchmarking of processes, tools, customer paths and contractual clauses.
  • Definition and implementation of process homogenization scenarios

HSBC : MIFID 2

  • MIFID2 compliance in France: Project management for the Private Banking line
  • Analysis of the impacts and monitoring of data quality on client repositories (SAB) and internal procedural standards