Oracle Financial Services has launched Oracle Financial Services Enterprise Stress Testing and Capital Planning Analytics, which is promoted as an enterprise-wide reporting tool that helps financial institutions assess the impact of adverse scenarios on their risk and performance, improve capital management and strategic planning, while efficiently facilitating compliance with emerging regulatory requirements around stress testing.
It added that the new enterprise-wide reporting application will help facilitate compliance with the stress testing requirements of Dodd-Frank, by providing out-of-the-box regulatory templates.
The application also supports a comprehensive set of pre-built dashboards and reports designed to support compliance with the reporting requirements of various regional regulations and governing bodies around enterprise stress testing, including: Basel III Pillar I, Internal Capital Adequacy Assessment Process (ICAAP) and US Comprehensive Capital Analysis and Review (CCAR).
The group added that, using the application, financial institutions can now manage capital planning by capturing and reporting the potential impact of adverse scenarios on risk and performance metrics. This can also be applied across the planning horizon based on the same stress scenarios thereby helping organisations facilitate consistency and comparability between the various metrics.
“Traditionally, stress testing has been carried out in individual risk silos, ignoring the interdependence between the risk and finance functions of an institution,” said S Ramakrishnan, group vice president and general manager of Oracle Financial Services Analytical Applications.
The new application “enables a more holistic approach to stress testing,” he added. “It helps banks efficiently comply with both management and regulatory reporting while providing a single, consistent view of current and future financial and risk metrics across baseline and stress conditions thereby providing actionable insight to the capital management process.”
However, a London summit on the industry’s introduction of the technology cautions that testing and acceptance are still at an early stage and firms should proceed with caution.
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