The Supervisory Review & Evaluation Process (SREP) is a periodic survey that investment firms need to complete. In 2023, the Dutch Authority for the Financial Markets (Autoriteit Financiële Markten, AFM) sent two questionnaires to approximately 250 investment firms and has now published generic results of that survey.
The results of the SREP are used to develop a market view, which the AFM and the Dutch Central Bank (De Nederlandsche Bank, DNB) will use for their supervision. Companies can use the results of the survey to benchmark themselves against their peers and make improvements where necessary.
The first SREP market view takes a closer look at ICT risk management, policy, the Product Approval & Review Process (PARP) and asset segregation. Initial observations show:
- A third of investment firms could improve their ICT risk management framework;
- Over 20% of investment firms incorrectly believe that the PARP does not apply to them;
- More than 90% of the respondents claim to have an internal risk management policy in place, but that this is not reflected in the implementation scores;
- One in five management companies have yet to develop policies on topics such as financial transactions with executive directors (including loans) and whistleblower protection.
The AFM publication and the results of the survey are available here: link