Thomson Reuters is building out its Connected Risk platform with the addition of a Model Risk Management (MRM) solution that allows financial institutions to demonstrate real-time understanding of their model risk landscape and report on model governance status and sign-offs from a single platform source.
The solution provides risk professionals with a holistic understanding of how each model in the business is derived, validated and applied. It includes a simple, yet powerful, approach to model governance, allowing the capture of updates and additions to the model inventory with real-time reporting to regulators. Changes are managed with an audit trail of supporting documentation, issues resolution and sign-off.
Regulations for which the MRM solution is a good fit include the Comprehensive Capital Analysis and Review (CCAR), Fundamental Review of the Trading Book (FRTB), Targeted Review of Internal Models (TRIM), International Financial Reporting Standard 9 (IFRS 9) and Basel III.
Gareth Evans, managing director, Enterprise Risk Management at Thomson Reuters, says: “Model transparency and efficiency continue to be challenges for many of our global customers. The MRM solution not only helps save time and costs, but also evidences a robust framework for internal and external stakeholders, while mitigating the risk of model failure, regulatory fines and operational losses.”
As well as supporting regulatory compliance, the MRM solution enables governance, risk and compliance teams to track all models across all risk themes using a single inventory store, helping to reveal potential redundancy and duplication within the inventory. Issues with models can be identified and tracked through to resolution, with supporting documentation showing methodology and results.
The Thomson Reuters Connected Risk compliance platform was introduced early this year and offers institutions ready-to-go risk and compliance functionality, as well as the option to integrate third-party RegTech and legacy technologies into a complete enterprise risk management solution. It includes technology that can translate internal and external data to a common standard, and provides user defined dashboards that show all risk data required by specific business strategies or regulators. The ultimate aim is an automated solution that gives firms a true and timely understanding of their risk profile and the information they need to make informed decisions.