Large Bank Examination Workshop February 2026

Discussion: Documenting Development 1. Why is documentation an essential element of model development?

2. What should be included in this documentation?

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Testing • Testing is an integral part of model development.

• The objective of testing is to determine whether the model is performing as intended.

• The tests and analysis performed will depend on the model and on the context in which it is to be used.

• Any single test is rarely sufficient, so banks should conduct a variety of tests to develop a sound model.

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