Regulatory Alerts2022-11-07
Model Management Standards
The Central Bank of the United Arab Emirates issues these mandatory standards to govern the complete lifecycle of quantitative models used by licensed banks, requiring rigorous oversight across governance, data management, development, implementation, usage, monitoring, and independent validation. Institutions must maintain comprehensive model inventories, enforce strict data quality and infrastructure protocols, and conduct thorough pre-implementation testing alongside continuous performance tracking to mitigate model risk. The framework further mandates independent validation procedures, delineates clear ownership and stakeholder responsibilities, and applies specific numerical thresholds to ensure all models remain accurate and fit for regulatory and strategic decision-making.