In June, the European Banking Authority (EBA) published its 2018 EU-wide stress test draft methodology, the related templates and the list of banks covered.
49 EU banks have been nominated by the EBA to participate in the exercise but the ECB has already required additional SSM banks to participate as well.
The final methodology will be published as the exercise is launched, at the beginning of 2018, with the results to be published in mid-year 2018.
The methodology covers all relevant risk areas and, for the first time, will incorporate IFRS 9 accounting standards. This will present banks with additional challenges, from producing IFRS 9 compliant figures as of January 1st, 2018 to calculating stressed risk parameters (PD, LGD, lifetime EL) and stage migration.
The results will inform the 2018 Supervisory Review and Evaluation Process (SREP), challenging banks‘ capital plans and leading to relevant supervisory outcomes. The exercise will also provide enhanced transparency so that market participants can compare and assess the resilience of EU banks on a consistent basis.
To help guide you through this critical exercise, please join us to hear about:
- The 2018 EU-wide stress test, the main changes from 2016 and the supervisory context
- The main methodological changes impacting and affecting credit risk and the other areas.
- Ways of handling the implementation of IFRS 9 in the stress testing methodology
- How best to integrate the stress tests with the capital framework and other processes and best practice
To address your questions and provide insights, we have invited a prominent group of speakers from the EBA and European banking institutions. In addition, PwC stress testing experts will be in attendance and present throughout the event.
More information on our PwC EBA Stress Test 2018 event and registration at: www.pwc-events.com/eba-stress-test
We hope to see you in Frankfurt am Main.