'Combining strengths to improve supervision'

Date 30 August 2012

'We’re now in a position to share the knowledge we obtain from one bank with other banks straightaway.' An interview with Ger Roeleven, senior supervisor at the new Financial Risks & Analyses Department

Why is DNB creating a separate Financial Risks & Analyses Department?

Ger Roeleven

'By forming a separate department, we can combine the strengths within DNB and further expand and consolidate our expertise in the field of financial risks. This will enable us to identify risks earlier and intervene sooner if necessary. The department will be staffed with specialists on interest rate, market, credit, tax and liquidity risks. We also have a team looking at the banks’ liquidity and capital buffers and we’re extending our financial analysis skills.' 

Does that mean my bank will be receiving visits from more central bank supervisors?

'You won’t be seeing more people, but you will meet more different supervisors. Previously all the supervisors were grouped into account teams that supervised a specific bank or group of banks. Now, approximately half of them still operate within an account team, while we deploy the other half more flexibly on theme-based supervision and financial risks & analyses. By applying our capacity in an increasingly targeted way, we hope to achieve more using the same number of people.' 

How do you expect to do this?

'A single member of the DNB team who is supervising a particular bank can’t possibly read all the reports that are published both by DNB and other organisations, such as the EBA liquidity report. But if he is a liquidity supervisor for all the banks combined, he will always read the EBA report. This not only allows you to gain a deeper understanding of the situation in the Netherlands, but it will also provide a better insight into the Dutch situation in the context of international developments.' 

Will DNB also be looking differently at financial risks?

'Yes, because we’re no longer just looking at individual banks but also comparing banks with each other, we can identify risky trends more quickly. A negative development that’s detected at one bank needn’t be a major risk, but if the same trend occurs at all the banks, this could be a cause for alarm.' 

What will my bank see of this new department?

'In future, the banks will be dealing with DNB staff who are more specialised and therefore better equipped to understand and analyse issues: they are familiar with an issue not from the perspective of a single bank but from a multiple-bank perspective. In the near future, this new working method will better enable us to give the banks good feedback on the results. Not only about their own bank, but also about how that bank is doing compared with others in the Netherlands or even internationally. We’re still in the start-up phase and our expertise will grow over time.'  

Does this new working method mean that our bank will have to supply more information to DNB?

'There has certainly been an increase in demand for information in recent years, mainly in response to international developments and legislation. We appreciate very clearly how this affects banks and are therefore working to improve the way we use all the information you submit. We can then apply it more efficiently and effectively, and banks will benefit from more and better feedback.'