Data Driven Supervision of transaction reporting data

The commission helped by providing technical support to the Cyprus Securities and Exchange Commission (CySEC) in response to their request.

This support aimed at developing a data-driven supervision system for key transaction reporting data, recognizing that financial supervision relies more and more on vast quantities of data, which can be challenging to process and thus may not be fully utilized in the supervisory process.

Context

CySEC supervises many entities dealing with complex and risky financial instruments that generate a large amount of transaction reporting data as part of the regulatory frameworks associated with the European Market Infrastructure Regulation (EMIR), the Markets in Financial Instruments Regulation (MiFIR), and the Securities Financing Transactions Regulation (SFTR). To this purpose, the project aimed to support the design of a more data driven supervision approach by CySEC.

Support delivered

• A comprehensive gap analysis between the initial state and the required state of CySEC, with regards to supervising the data stemming from EMIR, MiFIR and SFTR, including a comprehensive analysis of the technological infrastructure of CySEC.
• Several types of tests and checks for monitoring transaction reporting data.

Expected results

The project resulted in the establishment of a methodology and the formulation of a complete set of tests and checks to help CySEC with processing, monitoring, and analysing transaction reporting data of EMIR, MiFIR and SFTR, so as to proactively identify and assess financial risks.

To monitor, detect and investigate deficiencies and issues arising from the transaction reports, the project supported the development of templates to facilitate the work of CySEC’s Supervision Department and senior management.