On-site inspections 2018: Red flags raised on internal governance issues, credit and IT risk

In the last four years, the ECB’s Joint Supervisory Teams have undertaken various on-site inspections (OSIs) in their attempt to supervise significant banks within the framework of the Single Supervisory Mechanism (SSM). The OSIs are a successful tool for examining the banks’ internal control systems, business models and governance.

The key findings of the 2018 OSIs have been analyzed and published by the ECB. It is common practice that the findings are classified using a four-point scale, depending on the severity of the impact that would be generated if the issue remains untreated.

This article provides further insight on key concerns identified by ECB.