The Comprehensive Capital Analysis and Review (CCAR) is an annual exercise by the Federal Reserve to ensure that institutions have robust, forward-looking capital planning processes. These reporting requirements are applicable for all banks >= 50 Bn in total consolidated assets. 

It is onerous for banks to comply with in that it involves submission of very granular data (some at loan level) that cuts across risk and finance/treasury . This means there needs to be reconciliation between risk data and finance data. Some of the data requirements are given below     

  • Quantitative projections of Balance sheet, P&L, and capital across a range of macroeconomic scenarios    
  • Qualitative information on methodologies used to develop internal projections of capital across scenarios    
  • Granular data on asset classes and Pre-Provision Net Revenue (PPNR) for the reporting quarter, for continuous monitoring and comparison of actuals against projections 

Typical Issues faced by banks in implementation     

  • Requires unprecedented level of co-ordination between Risk, Finance, Treasury and Business units    
  • Annual reporting burden is around 5000 man hours.    
  • Onerous deadlines within a fortnight of each month-end (monthly, quarterly and annual data as applicable)    
  • Disparate data sources, inability to reconcile    
  • Too many manual interventions, unvalidated assumptions and data interpretations    
  • Risk of error; huge reputational impact    
  • Inadequacy of documentation. 

How we can help     

  • Creating a separate CCAR data store or integrating it with risk data store, if any    
  • Reconciliation of CCAR data with accounting data    
  • Validation of existing CCAR reporting process    
  • Documentation of the existing process    
  • Tactical Resource augmentation to alleviate reporting burden for ongoing reporting.    
  • Developing models that can project P&L and balance sheets    
  • Reconciling different sets of reports such as FR Y-14, FFIEC101, FR Y-9C as well as Basel I, II and III    
  • Adaptability to changing regulatory requirements. Product roadmap guarantees alignment of reporting formats with regulatory requirements    
  • Ongoing managed services reduce the compliance overhead tremendously.