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Recital 4

Recital 4

(4)To ensure sufficient in-house understanding of the alternative internal model, including outsourced operations, it is necessary to lay down that, despite any outsourcing of some risk tools, IT systems, and risk management solutions, all key tasks, activities or functions related to the internal model are to be conducted by the risk control unit referred to in Article 325bi(1), point (b), of Regulation (EU) No 575/2013. For the same reasons, those rules should also require that the risk control unit implements adequate controls and performs quality and validation tests for any outsourced solution, that full documentation on those controls and test is available in all cases, and that competent authorities assess any tools and IT solutions obtained from third party vendors in a manner similar to cases where they have been fully developed via internal processes.

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