TAC sub-committee meeting
Date: November 3, 2021
Time: 4:00 - 5:00 pm
Enhanced data collection – Rapid Prototype Journey
FSRA presented an outline of the Rapid Phased Prototyping (RPP) journey map for the enhanced data collection project, which included high-level timelines and outcomes for data architecture, data landscape, procurement, and prototypes. A project schedule is being developed to support the process.
FSRA will share the final data test template and request for proposal with the sub-committee for input and review when available.
Initial prototype credit union partner
To assist with the RPP, FSRA is looking to work with credit union volunteers to build a data landscape, review a sample data set, and review the results and provide feedback on the proponents that are in the initial prototype phase. Concerns were raised over the potential misalignment of expectations if only certain credit unions volunteer, and it was suggested to move towards a focus group/stratified sample.
Data needs, uses and frequency
FSRA is moving towards a principles base approach supported by risk-based supervisory framework where resources are focused on higher risk institutions. In assessing inherent risk – it’s necessary to have good data. Having this data in a timely and regular basis will support the principles-based regulation (PBR) and risk-based supervision journey.
Use and frequency of data
FSRA has view of the full sector and a mandate to promote its soundness and stability. Receiving this data on a timely basis allows FSRA to assess risk and financial stability on a forward-looking basis. The benefits of more frequent reporting, including quicker detection of fast acting risks, dynamic risk profiles of each credit union, and self-serve access for credit unions to more up-to-date aggregate data were presented.
Is alignment with RBSF and PBR, proportionality concepts will be applied with regard to the reporting requirements based on factors such as size, complexity and risk rating. A future item of discussion will be the type and nature of proportionality concepts.
FSRA requested input on any impediments or risk to providing monthly data. The committee echoed each other in identifying that more data doesn’t necessarily mean better decisions and that time should be spent on data training and the skill of modelling which is a fundamental principle of both data privacy and principles-based regulation.
The realization of benefits to the sector was discussed, including making the connection with the sector on how this data would work for them. Areas like premiums, DIRF Adequacy and supervisory actions were highlighted.
Concerns from the sub-committee over increased burden, where more data could lead to more questions from FSRA, was discussed. It was recommended that FSRA be transparent with the sector and explain how the data will be analyzed, evaluated and used. FSRA responded that the data will be used to assess areas such as credit risk under the RBSF and for ongoing monitoring, more information on the RBSF will be provided as part of the RBSF consultation process.
In response to a comment regarding the potential for ceaseless data requests, FSRA advised it had made minimal changes to data requirements over the years, and this move towards increased data points and frequency in reporting is in support of the risk-based supervisory approach and PBR. In addition, with the new CUCPA, credit unions will have expanded business opportunities that will require a level of analysis with enhanced data points.
A summary of these discussions will be provided at the next full TAC Meeting to ensure alignment with the overall TAC. Documents related to the RPP/RFP will be provided to committee members when available.
(A)ttended; (R)egrets; (S)ubstitute;
|Barry Doan||FirstOntario Credit Union||A|
|Pierre-Yves Monin||Caisse Desjardins||A|
|Mark Cauchi||Alterna Credit Union||A|
|Dominic Naimool||Kingston Community Credit Union||A|
|Parna Sabet-Stephenson||Gowling WLG||A|