Stress testing a European bank

We helped our client to complete their Comprehensive Assessment, ahead of joining the European Single Supervisory Mechanism.

The Challenge

Our client was a European bank required by the European Central Bank to participate in the 2014 Comprehensive Assessment, ahead of joining the European Single Supervisory Mechanism. This entailed an asset quality review, a supervisory risk assessment and stress testing.

They asked the PEN team to support them throughout this process in managing the overall programme and in specific key areas.

Our Approach

A mix of different approaches was required on this project - some reactive to authorities and some proactive.

Where a reactive approach was required, our programme team ensured clear allocation of roles and responsibilities and quality deliverables before dissemination to the authorities.

Specific tasks we completed within this project included defining the requirements necessary to deliver the asset quality review and overseeing those activities. We provided quality assurance of the outputs of the supervisory risk assessment, data gathering, modelling and forecasting for stress tests and engagement with internal and external stakeholders, including the executive committee and multiple authorities.

Finally, we planned for contingent activities to optimise different outcomes of the assessment. 

The Outcome

Our client delivered against all programme requirements and outputs dictated by the Comprehensive Assessment.

They were able to present a true and accurate position across the asset quality review, supervisory risk assessment and stress test, as demanded by the authorities.

Our programme minimised the impact of the assessment and simultaneously planned contingency activities had they been required. We kept all stakeholders updated and included the follow up activity the authorities required.