Data lineage

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Glossary · Regulatory reporting

Data lineage

Also called data provenance, lineage tracing

Definition

Data lineage is the documented path a piece of data takes from its source system to the figure in a report. It records every extraction, transformation and aggregation step on the way. Banks use it to prove that risk and regulatory numbers are accurate, complete and traceable when a supervisor asks.

SOURCE SYSTEMEXTRACT AND LOADTRANSFORMATIONRISK DATA MARTREGULATORY REPORT
Fig. 1 · Data lineage
BCBS 239 · ECB RDARR Guide
Key rulesBCBS 239 · ECB RDARR Guide
Applies toBanks directly supervised by the ECB
RegionsGlobal · EU
01

How it works

A bank identifies the critical data elements behind each risk indicator and regulatory return. Data teams then map the systems, feeds and calculations each element passes through, down to attribute level. The map is held in a metadata repository and refreshed when systems or calculations change. Reporting teams use it to trace an odd number back to its origin and fix the fault at source.

Supervisors treat lineage as evidence that a bank can aggregate risk data quickly and correctly in a crisis. The ECB ran a dedicated data lineage exercise for credit risk in its review of risk data aggregation. Persistent gaps can lead to enforcement measures, sanctions or capital add-ons. Good lineage also cuts the time spent reconciling reports and answering regulator queries.

Step 1Pick critical dataName the data elements behind key risk metrics
Step 2Map the flowTrace each element from source to final report
Step 3Record transformationsLog every extraction, calculation and manual adjustment
Step 4Keep it currentUpdate the map whenever systems or logic change
02

The rules

Global · 9 January 2013BCBS 239Principles for effective risk data aggregation and risk reporting

Sets 14 principles requiring banks to aggregate accurate, complete and timely risk data and report it reliably, including in stress.

Global systemically important banks, recommended for domestic systemically important banks
EU · 3 May 2024ECB RDARR GuideECB Guide on effective risk data aggregation and risk reporting

Expects complete, up-to-date data lineage at attribute level for risk indicators and their critical data elements.

Banks directly supervised by the ECB
03

Common questions

Why do regulators care about data lineage?

Supervisors need confidence that reported figures are right. Lineage shows where each number came from and how it was changed. It lets a bank and its supervisor find the source of an error quickly and check that controls work along the whole data chain.

Is data lineage a legal requirement?

No single law uses the term as a standalone duty. BCBS 239 sets principles on data architecture and accuracy, and the ECB's 2024 guide states an explicit expectation of attribute-level lineage for significant banks in the euro area.

What is the difference between data lineage and data quality?

Data quality measures whether data is accurate, complete and timely. Data lineage shows where data travels and how it changes. Lineage helps firms find the cause of quality problems and prove that quality controls sit at the right points.

How granular should lineage be?

The ECB expects lineage at the level of individual data attributes for critical data elements behind risk indicators. Many banks start with the most material reports and extend coverage over time.