The Committee of European Banking Supervisors (CEBS) has published high level principles for risk management.
The purpose of the high level principles is to consolidate CEBS’s existing principles and guidelines on risk management by developing a set of overarching high level principles that can form a stand alone document but can also be expanded upon by CEBS guidelines on specific topics.
The high level principles relate to:
- Governance and risk culture.
- Risk appetite and tolerance.
- The role of the chief risk officer and the risk management function.
- Risk models and the integration of risk management areas.
- New product approval policy and process.
The high level principles should be considered by both institutions and supervisors within the supervisory review framework under Pillar 2. In other words, they should be implemented by institutions as part of the ICAAP and reviewed by supervisors as part of the SREP. Supervisors should implement the high level principles into their procedures by 31 December 2010.
The high level principles are aimed mainly at large and complex institutions. However, according to the principle of proportionality they can be adapted to any institution under review, taking into account its size, nature and complexity.
View CEBS publishes its high level principles for risk management, 16 February 2010