Dr. Cyril Roux:

It means that firms did not invest as much as they should have in their IT in the build up to Solvency II. Why is that? As I explained, it is because Solvency II is a sea change in the information chain. It relates to the information you need to collect and means those on the ground, such as people in claims centres, need to ask different questions which are put into different treatment chains. This is a major challenge not only for the supervisor in respect of getting ready but also for the insurers. In the build up to Solvency II, they spent effort and energy in building the new information chains while the old information chains were creaking a bit. You do not repair to the same extent something that you will abandon at the end of 2015.

In terms of governance, we wanted to carry out a public service by making available to the public the thing we saw and then by challenging boards to reflect on that and to contrast the situation of the information they got from the management to the information we give to them, as well as the situation of their firm to the situation of other firms.

We give that information and we use it to challenge boards to act upon it. The risk appetite statement and the way it is articulated is very important for us. It is important that the board monitors the risk the management takes.