Transforming data collection: Bank of England and FCA deliver on phase one commitments – 6 July 2023

The Bank of England (BoE) has published a press release to provide an update on the progress of the joint Transformation and Data Collection program (TDC) or brief the transformation programme, which is being led by the Bank of England and the Financial Conduct Authority (FCA) to transform data collection in and from the UK financial sector. The program’s vision is that „the Bank of England and the FCA get the data they need to fulfill their mission, at the lowest possible cost to industry“. The program is conducted in phases with each phase covering selected reporting areas with selected use cases.
This latest update covers the following key areas:
(1) the delivery of the phase one recommendations: The two regulators provide an update on the recommendations made and adopted after the phase one discovery and design work for the Quarterly Derivatives statistical return (Form DQ) and the Financial Resilience Survey (FRS). Thereafter, as regards Form DQ, work continued on the landing pages design, the restructuring of the reporting instructions, and the development of a standardized counterparty classification system. As far as FRS is concerned, work revolved around the design of a shorter survey, the creation of intuitive form designs, and the visualization of the data submitted by firms.
(2) the progress of the phase two use cases: The phase two program has made significant progress since the last reporting with most use cases in the design stage, except for Incident, Outsourcing, and Third Party Reporting (IOREP), which is in the discovery stage. Key updates are as follows:
– Retail Banking Business Model Data: Prototypes were tested to improve data collection efficiency and quality, with potential applicability for the Bank of England. Use cases are expected for Q4/2023.
– Strategic Review of Prudential Data Collection: User research has identified opportunities to reduce reporting burdens and improve data accuracy. Prototypes were developed and further research will be done in this area.
– Commercial Real Estate (CRE) data: Three potential solutions have been chosen for the recommendation stage. Prototypes have been developed and tested by users which will help to refine the data collection process.
– Incident, Outsourcing, and Third Party Reporting: The discovery phase has been completed, and the team is moving into the design stage to address issues faced by users.
(3) the Data Standards Review: During the first phase of the program, the Data Standards Committee (DSC) commissioned Ernst and Young (EY) to conduct a review on data standards in financial services. The review involved a public consultation, stakeholder interviews, and research analysis to determine the conditions required for greater development and adoption of standards. EY has completed the review and provided a report with conclusions and proposed next steps. Based on the final report, the DSC has written recommendations to the Bank and the FCA, focusing on the report’s conclusions. The Bank and the FCA are currently evaluating these recommendations and preparing a response outlining the actions they will take to address them. The full EY report, DSC recommendations, and the joint response will be published on the TDC webpage by the end of July 2023.
(4) the future of Transforming Data Collection: Both regulators note that over the past two years, they have undergone a valuable learning experience: They have gained crucial insights, delivered concrete value, and developed multiple solutions, which are now being taken forward for further development and scalability. The TDC is now entering a new phase, marking a significant shift in priorities for both the Bank and FCA. The focus will now be on prioritizing implementation and transformation over continuous learning and incremental delivery. To steer this process, a refreshed strategy for data collection transformation is in the works and is expected to be published in the first quarter of 2024. This strategy will serve as a guide for the upcoming efforts and outline the approach and objectives for the transformation process.
Apart from the above updates, the Bank of England also briefly outlines the content of a meeting of members of the joint transformation programme at the BoE on July 13, 2023.