Banking Alert: ECB sets new expectations on ICAAP and ILAAP

Starting 1st January 2019, the ECB will use the recently published guidelines when assessing Banks’ internal capital and liquidity adequacy assessment processes

In 2016, the ECB published its first guidelines regarding the ICAAPs and ILAAPs of supervised institutions. However, after undertaking a thorough assessment, the ECB identified significant differences in the approaches taken on a bank to bank basis and the need for further improvements. As a response, at the beginning of 2017, the ECB launched a multi-year plan for ICAAP and ILAAP. The plan brings on a more granular description of the ECB’s expectations, taking into account feedback received from institutions and other industry participants.