Banking Alert! ECB guide to on-site inspections (OSIs) and internal model (IMIs) investigations

ECB published last week the guide to on-site inspections and internal model investigations.

Bank inspections are a critical tool for supervisors worldwide. They are performed in order to provide an in-depth analysis of different risks, internal control systems, business models or governance.

Inspections have a pre-defined scope and time frame and take place on the premises of the inspected bank or a related legal entity. They are intended to be intrusive while adhering to the principle of proportionality and aim to provide a detailed snapshot of the situation of a given bank, including a forward-looking analysis. If deemed necessary, the scope and timeframe of the inspection can be changed while the inspection is in progress.