PwC's Managing upstream risk: Regulatory reform review - An asian perspective November 2013 | Page 17

• Another example of good practice identified
is the comparison between banks with
similar characteristics and historical
information, which could constitute a
central input to the SREP/JRAD (Joint Risk
Assessment and Decision) for cross border
banking groups.
• Finally, the results of the report
encourage discussions about the stress
test in supervisory colleges. All relevant
information should be used in the joint
decision process, together with documented
processes, principles and methodologies.

The peer review work focused on methods
and examples of best practice, and covered (i)
stress testing governance structures and their
use, (ii) possible methodologies including
the appropriate severity of scenarios and
potential mitigating measures during stressed
conditions, and (iii) the overall impact of risk on
institutions.

Banking

2.11 LIBOR

Update

It has been reported on 6 November 2013 that
EU antitrust regulators will levy a record fine
of at least €1.5 billion ($2.02 billion) on six
financial institutions, including Barclays and
Royal Bank of Scotland, for rigging the yen
LIBOR interest rate benchmark. The world’s top
interdealer broker, ICAP, and Dutch cooperative
bank Rabobank are among the firms that will
be fined. Switzerland’s UBS will not be fined
because it was the first member of the group to
come clean during the European Commission’s
investigation into wrongdoing. The yen LIBOR
fines, likely to be the biggest so far to be handed
out by Brussels, come on top of other penalties
for a separate case involving the rigging of the
EURIBOR benchmark interest rate. The fines are
expected to be handed out at the end of 2013.

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