UK financial authorities complete SIMEX 24 03 October 2024UK Reporter: Daniel Tison
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The Bank of England (BoE), in partnership with the Financial Conduct Authority (FCA), HM Treasury, UK Finance, and the financial sector, has undertaken a UK-wide simulation exercise.
The Cross Market Operational Resilience Group (CMORG), a strategic partnership established by the BoE in 2015, was behind the development and delivery of the simulation exercise (SIMEX).
SIMEX 24 aimed to test the UK financial sector’s ability to respond to a major infrastructure failure that would require a total shutdown and restart of the sector.
It is the latest exercise in a continuous programme that explores the financial sector’s response to some of the most challenging scenarios, including those on the UK Government’s National Risk Register.
According to Sam Wood, deputy governor of prudential regulation and CEO of the Prudential Regulation Authority, it is “vital” to prepare the financial industry’s response to a wide range of risks, including the most challenging scenarios.
He says: “SIMEX and the sector exercising programme provide unique opportunities for the whole banking sector, across industry and the authorities, to practise how to protect and defend services on which the economy depends.”
David Postings, chief executive of UK Finance, adds: “A resilient financial sector is crucial in a modern economy and a continual area of focus for the financial services industry. The sector-wide exercise this week helps ensure we can respond effectively to any potential incident and protect the UK’s financial system and its customers.”
With collective action, CMORG aims to enhance the operational resilience of the UK financial sector through the identification of systemic risks, the development of solutions to support sector-wide mitigation strategies, and the sharing of knowledge across the sector.
The group conducted a similar exercise, SIMEX 22, in November 2022.
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