Aanbevelingen Europese Rekenkamer voor beter risicomanagement Europese Centrale Bank (en)

The European Court of Auditors (ECA) examined the appropriateness of the ECB’s overall risk management framework and assessed whether the ECB manages operational and financial risks effectively. The ECA concludes in its specific annual report that the ECB has established a comprehensive organisational structure, roles and responsibilities are clearly assigned, but that there is a strong demarcation between the management of financial and operational risks in the Bank. This increases the risk that the view of the Bank’s exposures might not be comprehensive. In addition, the annual accounts of the ECB contain only brief information about certain risk management issues.

The assessment of the operational risk framework showed that the ECB has a clear organisational structure and has established adequate operational risk management policies. However, the ECA identified some weaknesses in the ECB’s approach to assessing, monitoring and controlling / mitigating risks.

The review of the financial risk management framework indicated that the financial risk management methodology designed is sound and adequate for the management of investment and policy operations at the ECB. However, improvements are required in the practical application of the methodology.

The ECA makes a number of recommendations to the European Central Bank to further improve its overall risk management. These include:

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  considering setting-up a hierarchically independent, single, risk management function, such as a chief risk officer or committee that would concentrate solely on risk management and ensure a comprehensive view of the Bank’s exposures;
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  further improving its public disclosure of risk management practices to external parties in the annual accounts by applying best practices, such as IFRS 7.

Background:Risks are managed through two separate frameworks at the ECB. The operational risk management unit (ORM/BCM) covers all operational risks including business continuity. The Risk Management division (RMA) deals with the financial risk management, including the ECB’s investment activities and credit operations.

The European Court of Auditor’s (the Court) audit of the operational efficiency of the ECB is based on Article 27(2) of the Protocol on the Statute of the ESCB and of the ECB. The 2010 audit covers the risk management procedures and systems established by the ECB and their application.