Financial Supervisory Authority will focus in 2024 on risk resilience of supervised entities in a changing operating environment and on soundness of governance
Changes in the operating environment resulting from economic uncertainties, cyber security risks and enhanced regulation underline the importance of capital adequacy, liquidity and sound governance. In 2024, the Financial Supervisory Authority’s supervision and inspections as well as thematic assessments and analyses will focus on these themes.
In January 2023, the Financial Supervisory Authority (FIN-FSA) published, as a supervision release, its full-year assessment and inspection plan for the first time.
The plan for 2023 was implemented fairly comprehensively. Some inspections were cancelled due to, for example, changes in the supervised entity’s situation or the reallocation of supervisory resources.
-Our objective is to be a proactive and predictable supervisor, in line with our strategy. We will enhance predictability by, for example, communicating our supervisory plans so that our supervised entities know what we consider to be important at any given time. We also aim to be flexible and ready to review supervisory priorities, if necessary, throughout the year, says Tero Kurenmaa, Director General of the FIN-FSA.
The FIN-FSA’s supervisory priorities in 2024 relate to operational and financial risks in the uncertain operating environment, long-term trends and soundness of supervised entities'governance.
As regards sound governance, the focus will be on governance and control systems, the risks and management of outsourcing and the quality of data. Findings in code-of-conduct supervision are also increasing in Finland, and they are often a sign of a functioning governance and control system. As regards operational risks, the focus will be on, for example, compliance with and supervision of sanctions as well as preparedness and continuity management. Of financial risks, the focus will be on vulnerability of capital markets to shocks, valuation of illiquid assets, increase in credit risks and challenges in liquidity management. Of the long-term trends in the operating environment, supervision will focus on ESG risks, the increase in ICT and cyber risks, financial sector digitalisation as well as tighter and changing regulation.
Quantitative distribution of thematic assessments and inspections in the supervisory priorities