Regulatory Compliance in Germany: A Top Priority for Financial Institutions

Introduction

Berlin, Germany - Effective risk management is a top priority for financial institutions operating in Germany. Regulatory compliance plays a crucial role in this process, ensuring that financial service providers adhere to legal and regulatory requirements while minimizing risks.

The Role of Regulatory Requirements

Implementing regulatory requirements involves not only meeting international standards such as Basel III/CRD IV but also complying with national regulations like MaRisk. Internal control is also vital, as it helps monitor and minimize the risk of compliance violations or reduces the consequences of non-compliance.

Key Challenges in Managing Regulatory Compliance

German financial institutions are facing several challenges in managing regulatory compliance, including:

• Unclear definitions of risk appetite
• Unnecessary costs due to redundancies and inefficiencies
• Inconsistencies in management reporting
• Overlapping responsibilities in internal control procedures
• Lack of transparency about existing gaps in compliance

KPMG’s Consulting Services for Regulatory Compliance

To address these challenges, KPMG offers a range of consulting services designed to help financial institutions implement and optimize the implementation of regulatory requirements, manage compliance, and achieve regulatory compliance. This holistic approach integrates risk management into strategic decision-making and control processes, using efficient risk measurement and control systems.

Benefits of an Integrated Governance Model

By adopting an integrated governance model that links risk management with the compliance function and internal control system, including internal audit, financial institutions can:

• Minimize frictional losses
• Ensure effective risk management
• Navigate the complex regulatory landscape
• Achieve sustainable growth while maintaining compliance with regulatory requirements

Conclusion

Regulatory compliance is a top priority for financial institutions operating in Germany. By adopting an integrated governance model and leveraging KPMG’s expert guidance, German financial institutions can overcome the challenges of managing regulatory compliance and achieve sustainable growth while maintaining compliance with regulatory requirements.