Stress testing and scenario analysis are of paramount importance, since they can reveal potential concentrations of risk that may not be apparent from using information gleaned from normal times.
See here. IFRS 9 is a new accounting standard that will be effective from 1 January 2018. It introduces an expected credit losses model (ECL) which may lead to higher impairment provisions and more volatile impairment charges with a consequent impact on capital ratios. The SSM has committed to undertake a targeted review of internal models (TRIM) for banking groups. See here.