A decade after the acute phase of the global financial crisis and banks still don’t accurately track their risk.  Of course, this isn’t surprising given the regulators shield the banks and act as a barrier to the banks providing transparency to the financial markets.

According to the Basel Committee on Bank Supervision’s progress report on banks complying with its Principals for risk date aggregation and reporting by 2016,

in 2017 most G-SIBs made, at best, marginal progress in implementation.

Why haven’t banks been able to aggregate their risk?

G-SIBs have found it challenging to comply with the Principles, due mainly to the complexity and interdependence of IT improvement projects.

Translation: collecting, reporting and managing risk is a low priority for the globally systemically important banks.

As a senior operations executive at one of these banks explained it to me, compliance would already have occurred if banks were required to disclose their current exposure level data.  They could have used the latest in software technology to report and manage their risk.

Instead, by not disclosing their current exposure level data, banks get to delay compliance while they slowly upgrade their existing decades old information systems.  This is a prescription for never aggregating and reporting risk data.  Exactly what the BCBS found.