Download Ss123 2022 Zip Link

A designated Senior Management Function (SMF) must be accountable for the MRM framework.

When models have known limitations, firms should use Post-Model Adjustments (PMAs) to account for latent risks. Implementation Timeline

The SS1/23 Supervisory Statement (published in May 2023, following consultations in 2022) focuses on five core principles to ensure firms identify, assess, and mitigate risks from quantitative models: Download Ss123 2022 zip

The PRA defines a as any quantitative method or system that applies theories and assumptions to process input data into output. Principle 2: Governance

Firms should establish a robust board-level framework for model risk. A designated Senior Management Function (SMF) must be

Models must undergo rigorous testing during development to ensure they are fit for purpose.

While the statement was finalized in 2023, the foundation was laid in through the CP6/22 Consultation Paper. Most firms were expected to have implemented these principles by May 2024. SS1/23 – Model risk management principles for banks Principle 2: Governance Firms should establish a robust

A team independent from the model developers must perform a critical review of the model’s performance and assumptions.