18 October 2010
CEBS has today published its second peer review report on the functioning of colleges aimed at enhancing supervisory convergence by means of assessing the implementation of supervisory provisions set out in EU legislation, CEBS guidelines and other CEBS documents.
The focus of the review was to highlight the methods used by supervisory authorities in the setting up and functioning of supervisory colleges as well as to identify good practices.
Based on a sample of 17 colleges recorded as of March 2010, this report presents the outcome of the review carried out by the Review Panel between 26 April and 8 June and a series of good practices for improving the functioning of colleges. The report focuses on three core areas of activities:
• Information exchange;
• Risk assessment;
• Planning and coordination.
Overall, the 17 colleges under review are up and running and have passed a number of milestones, but some colleges still need to make further progress.
A regular exchange of information among all the members of a college contributes to effective coordination and cooperation and to the development of a common understanding of the group's activities and risk profile. The Review Panel found that 11 colleges have fully applied the requirements regarding information exchange, four have applied them partially and two have not applied them satisfactorily.
With regard to risk assessment, some colleges have used a top-down approach mainly driven by the consolidating supervisor, whereas other colleges have opted for a bottom-up and more interactive approach. The Review Panel found that 15 colleges have fully applied the requirements relating to risk assessment, whereas two s have not. Finally, concerning the planning and coordination of college activities, whereas joint on-site inspections appear to be widespread, further progress needs to be achieved in common supervisory planning. The Review Panel found that nine colleges have fully applied the requirements for planning and coordination, three have applied them partially and five have not applied them satisfactorily.
Although supervisory authorities have achieved considerable progress in establishing effective colleges, much remains to be done to ensure that risks are commonly identified, assessed and mitigated. Fostering this development is one of the main challenges facing CEBS/EBA as required by the CRD and by the regulation establishing the EBA. In this spirit, the Review Panel expects this report to contribute to the effective functioning of supervisory colleges and to the convergence of supervisory practices in the EU.