Transforming data collection communication to firms – 10 February 2022

Communication to firms to provide an update on the progress of the joint transformation programme, which is being led by the Bank of England and FCA with industry, to transform data collection from the UK financial sector.
Published on 10 February 2022

The Bank of England (BoE) and the Financial Conduct Authority (FCA) are leading a joint transformation programme with industry, to transform data collection from the UK financial sector. In this publication we are providing an update on the programme since our last communication in December 2021 including:

  • what has been achieved and the progress that has been made;
  • planned activities between now and the start of the next phase of the programme at the end of June;
  • an update on the request for solution design ideas from vendors and;
  • the skills and capabilities we are looking for to help us continue to progress the programme together.

The three key takeaways from this communication are:

  • subject to resource availability and approval by the Reporting Transformation Committee, we would like to extend the phase one Commercial Real Estate (CRE) reporting use case from the end of March to the end of May;
  • we would like industry participants who are part of the core delivery team to stay with the programme until March 2023. During April and May 2022, they would work with us to capture lessons learnt from our first iteration of the use cases;
  • we would like firms to provide additional resource to phase two of the programme. In addition to the resource who we currently have in the programme, we are looking for a total of around 20 FTE from firms to be part of the core delivery team. More details about the type of resource we are looking for can be found in the ‘Future work and resource requirements’ section of this update.

You can find out more about the joint transformation programme and the work it is carrying out on the Transforming Data Collection webpage.

Joint transformation programme: progress and achievements since December 2021

Overview of programme progress and achievements

Since our last update in December 2021, there has been good progress made on all three of the phase one use cases. The programme team have moved into the alpha solution design stage during which:

  • priority problems, hypotheses and solution features have been identified for each of the use cases;
  • solution features have reached varying stages of design, testing and refinement;
  • a series of vendor showcase days have been held to broaden the input to solution design;
  • work has begun on scaling which has highlighted a number of common problem and solution areas across the use cases.

A status report of the use case delivery key activities is below.

Use case

Alpha prototypes finalised

Demo days for vendor input to solution design

Alpha test phase

Investment case and road map

Quarterly Derivatives Return (Form DQ)

Complete

Complete

In progress

March 2022

Commercial Real Estate (CRE) reporting

In progress*

Complete

In progress*

May 2022*

Financial Resilience Survey (FRS)

Complete

n/a

In progress

March 2022

*Discovery and Design stage for the CRE use case to be extended until the end of May 2022. More details in the ‘Future work and resource requirements’ section of this update.

Below are some of the key achievements and developments made alongside the delivery of use case solutions since December 2021.

  • The Data Standards Committee have commissioned a Data Standards Review. The review has the objective of understanding how data standards can be better developed and adopted for the benefits of reporting.
  • The programme has set up the scaling team. The team is looking at how the work of the programme can be scaled in future, for instance by trying to identify synergies between use case solution designs.
  • Both the Data Standards Committee and Reporting Transformation Committee meetings took place in the first week of February. The minutes and meeting packs will be published to the TDC webpage.
  • The first version of the framework we will use to measure programme value has been created,
  • We are seeing increasing levels of engagement with the programme. Number of views of our publications have increased and multiple vendors have submitted proposals to feed into our solution design.

Progress deep dives

Update on the request for vendor input to solution design

The design process operated by the programme team is a deeply collaborative one. The team are engaging with stakeholders with relevant knowledge and expertise in areas that relate to our use cases. In December 2021 they asked vendors and others to submit potential solution design ideas for the challenges the team have identified for the Quarterly Derivatives Return (DQ) and Commercial Real Estate (CRE) reporting use cases.

The response to the request was very positive. We received almost thirty proposals. Throughout January 2022, we invited sixteen vendors to present their solution proposals in depth to a small panel of programme members. We found these showcase days very helpful. We are continuing to engage with vendors to understand more about their ideas and how they can help with the solution designs for our use cases.

We are always interested in hearing from people with ideas that can help progress the work of the programme. If you think you have something that we would like to hear about, please email us at TDCSecretariat@bankofengland.co.uk

If you would like to find out more about the request for input, information can be found on the request for input news page.

Overview of solution design

The programme team has completed the problem identification stage. Many of the findings from this phase aligned with the high level findings of the Data Collection Review carried out in 2020. These include challenges firms face understanding our reporting instructions, and issues the BoE and FCA face with the quality of data they receive.

The programme team are now in the alpha solution ‘design’ stage. They are designing solutions to fix the issues identified, with a view to testing the solutions and building business cases to support them by the end of March 2022.

The ambition of the solutions vary, as do their expected timelines for implementation. For example, the team is designing improvements to the stats reporting page of the Bank of England (BoE) website. Longer term these designs would feed into the regulatory reporting sections of the BoE website and PRA rulebook.

An overview of the use cases and the solution design proposals is below. If you would like to find out more you can email us at TDCSecretariat@bankofengland.co.uk

Use Case

Solution design proposals

Status of design proposal

Commercial Real Estate (CRE) reporting – with a focus on improving the quality and coverage of commercial real estate data available to the PRA and FSSR

Design an integrated future proofed regular data collection
Rationalise the collections into one, source additional data via collection or a third party, make the rationalised collection quarterly and implement one (or a combination) of the market coverage options.

Prototyping

Data Dictionary
Define a small number of CRE business glossary data description standards that can be consistently applied across the financial sector and are open and accessible to all those who need them. 

Prototyping

Use customer identifiers to enable the creation of a Single Customer View
Improve the use of the data by embedding a common customer identifier in the dataset. The customer identifier will allow the Bank, and firms, to aggregate and identify risks across single customers, match real estate risks to specific entities and to better identify linkages between landlords, tenants and bank

Prototyping

Deal capture guidance tool
Develop guidance for firms to enable them to capture their loan data in a standardised way which could be more easily mapped to reporting requirements.

Prototyping

Market Analytics
Demonstrate how firms will be able to gain insights from market analytics derived from the improved CRE data collection

Testing and Refinement

Quarterly Derivatives (DQ) return - aiming to design improvements to data on the derivative asset and liability positions of the UK financial sector. This data ultimately feeds into the UK’s balance sheet compiled by the ONS

Counterparty classification standardisation
Reduce the cost to individual firms for maintaining reference data mappings.

Testing and Refinement

Form DQ attribute definitions & proposed standards
Simplify reporting instructions, restructure and eliminate the need for embedded PDFs.

Testing and Refinement

Improve communications between regulator and industry
Improve information sharing and communication between regulator and firms, starting with explaining why better.

Prototyping

Financial Resilience Survey (FRS) - looking to formalise a post-pandemic ad-hoc collection of select data points from FCA firms, used for prudential risk monitoring

Reghub portal & home pages
A web-based portal with single sign-on which firms can use as a single point of contact with the FCA, including a single landing page for all firm interactions e.g. apply/vary permissions, view/create reg returns, pay invoices.

Testing and Refinement

Firm view at a glance
A graphical/dashboard display of a firm’s regulatory return information over a period of time, against firms in their sector and FCA risk.

Testing and Refinement

Future FRS survey
Future direction of the FRS survey and prudential data.

Prototyping

FCA data duplication tool
A tool to identify existing data requests across the FCA’s existing regulatory returns, before requesting a new return.

Prototyping

FRS form design
A new standardised form for completing reg returns which provides enhanced User Experience features such as work mode, introductory information and access to other help features linked to RegData.

Testing and Refinement

Future work and resource requirements

We think the reform agenda for Transforming Data Collection will take a decade to deliver. Our plan of work over the next fifteen months is presented below.

Now to June 2022

Phase one ‘Discovery and Design’

We are in the ‘Discovery and Design’ stage for all three of the phase one use cases. At the end of this stage the Reporting Transformation Committee and Data Standards Committee will make recommendations to the Bank, FCA and industry about which solutions they think should be taken forward.

The ‘Discovery and Design’ stage for the phase one use cases is scheduled to finish at the end of March. Subject to resource availability (see below), and Reporting Transformation Committee approval, we would like to extend the ‘Discovery and Design’ stage of the CRE use case until the end of May. The CRE use case is perhaps the most complex of the phase one use cases. At the same time we think it is the best opportunity to create the blueprint for a transformed reporting process. The extra time would give the programme team time to further develop and test their solution designs.

Scaling

We expect our scaling work to provide a bridge between use cases, and phases over the course of the programme. Over the next two months the team will be focused on:

  • Capturing the learning from the phase one use cases that can be used by the programme in future. This includes capturing and describing common issues and solutions, and the ideas of the programme team about how the current set of solutions could be developed and scaled in future.
  • Creating a combined ‘end to end’ vision of a transformed data collection process based on the features developed for individual use cases.
  • Developing prototypes for solution features that are common across use cases. For instance, this might include extending the prototype for the FCA RegHub portal, being developed as part of the FRS use case, to cover Bank, PRA and FCA data collections.

Phase two use case selection

We plan to kick-off work on our phase two use cases in June 2022. The process to select phase two use cases is underway. During that process, we are consulting the Reporting Transformation Committee to get industry views on use case selection. We expect to announce our expected use cases by mid-April. The final phase two use cases announcement will follow at the end of May, following the completion of our internal governance processes.

Data standards review

We expect the data standards review to be underway by the end of March and complete by the end of June 2022.

Decision and challenge for phase one use cases

By Q2 2022, the programme team will have moved from the ‘Discovery and Design’ stage to the ‘Decision and Challenge’ stage for all three phase one use cases. During this stage firms and authorities will considering the recommendations from the programme. For the Bank and FCA, we expect to take phase one solutions through internal review and governance in April and May 2022.

Phase two planning (subject to resource availability)

We recognise the programme team has been under pressure to deliver over the last seven months. Inevitably, that pressure means it has been hard for the team to take stock of how they work today, and better plan their work in future. Before we start work on our Phase two use cases, we would like to spend April and May capturing lessons learnt from our first iteration of use cases, and planning for the next phase.

We would like the phase one programme team to stay on to help us with that work.

June 2022 to July 2023

Phase one use case delivery

From July 2022 to June 2023, we aim to move to the ‘service delivery’ stage of our phase one use cases. We expect to draw upon the recommended solutions from the programme as we invest in our data collection solutions and platforms, and as we plan the future activities and roadmap for transforming data collection.

We have committed to delivering valuable change by at least June 2023. By using an iterative, agile development model, we hope to deliver new solutions long before that.

Most of the solutions being developed by the programme have strong external facing elements. We expect to ask for help from firms in testing our external facing solutions and gathering their feedback as we develop them. We will be looking to form a group of industry users to do this. We expect that group will consist of individuals that actively use those platforms, and they will need to contribute 2 days a month of their time for a 12-month period from July 2022 to June 2023. We expect the programme committees to continue to play a role in monitoring the development and roll out of recommended solutions.

CRE service delivery

We think the delivery of an ‘integrated future proofed regular data collection' for CRE will be complex. It would also require a formal consultation to be carried out. As such, if we decide to progress such solution to delivery, we envision further design, ‘alpha’ prototyping and testing to take place before the solution is implemented. Further prototyping and testing of the solution will require resource from both authorities and firms.

Phase two use case discovery and design (subject to resource availability)

From June 2022 to March 2023, we expect the joint transformation programme to carry out a ‘discovery and design’ stage for our phase two use cases. To enable us to continue with our ‘discovery and design’ work for new use cases, as well as scaling solutions from our phase one use cases, we will be asking firms to provide twice the levels and types of resource to the delivery teams as they do currently – around 20 FTE for the core delivery team. These FTE will focus on discovery and design and will allow us to scale the approach and deliver more value faster. The key full time roles we expect to require are:

  • Business analysts and lead business analysts
  • User researchers,
  • Lead service designer,
  • User experience designers,
  • Delivery managers,
  • Lead business case analyst,
  • Developers,

In addition we will need to be able to drawn upon the expertise of individuals with the following skills:

  • Technical architects,
  • Solution designers
  • Data management specialists,
  • as well as SMEs in compliance and areas specific to the new use cases.

If you would like more information about our resource needs in phase two, please get in touch by emailing TDCSecretariat@bankofengland.co.uk and we can send you a job description.

Development of a prototype ‘standards as a service’ module

We expect the success of transforming data collection to rely on the quick development and roll out of industry data standards. These standards will require governance, platforms, tooling, training, and people to manage and support them. We expect standards will need to be provided in a way that makes it easy for them to be used. We expect standards will need to be set up or modified quickly and flexibly. We are calling this capability ‘standards as a service’. We think that developing supporting tools will be critical to making standards as a service happen.

We plan to carry out a proof of concept to design and test what these tools might look like in H2 2022.

Future use case roadmap development

We recognise industry’s desire for greater clarity on what use cases we will tackle when. We will be working on developing our use case roadmap during Q1 and into Q2 2022. We expect to publish our roadmap in Q2 2022. We will engage with industry prior to the publication of that roadmap.

Future joint transformation programme communications and updates

Where to get communications and updates

We are committed to working in an open, collaborative and transparent manner. We will be providing programme updates every two months. In the meantime we will continue to publish the minutes from the Committee meetings. Starting from February, we will be publishing the meeting packs alongside the minutes. We will soon provide an update on how the programme will engage with FCA solo-regulated firms. In addition, there will regular opportunities to be involved with our work and to give feedback.

You can find all communications from the joint transformation programme on the Transforming Data Collection webpage.

If you could like to get involved or find out more please email TDCSecretariat@bankofengland.co.uk

Town Hall

On Tuesday 15 February at 2pm (GMT) we will be running a Town Hall to update on the joint transformation programme and clarify the key messages from this communication. If you would like to attend, please register by COB Monday 14 February.

There will a short time set aside during the Town Hall for any questions. Alternatively you can email your questions to TDCSecretariat@bankofengland.co.uk by Monday 14 February and we will endeavour to cover them on the day.

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