Survey on Data Management for Risk Management
Our new survey on Data Management for Risk Management, sponsored by Asset Control, is now available for download.
We surveyed major banks across the world to establish their data management practices and challenges. Two themes emerged – a move to a more centralised data management structure and the impact of regulation.
In regard to the centralisation debate:
- Banks are striving for a more centralised model to increase efficiency, cut costs and reduce operational risk
- There are differences in centralisation according to data type – as an example, our survey revealed that market data was the most centralised
- While many Tier 2 banks may view a completely centralised model as desirable and achievable, others are continuing with a silo based approach. For Tier 1 banks, the complexity of their operations often means that such a single data management function covering all data types , business functions and locations may not be possible, but they attempt to centralise as much as they can
In terms of drivers for change:
- Banks currently see regulation as being more important than internal drivers
- 85% of the banks we surveyed regarded regulation as a highly significant driver of change. BCBS 239 and the Fundamental Review of the Trading book were cited as the two most significant areas of regulation
- Both regulations put a strong emphasis on high quality data: while BCBS 239 focuses on data governance, data quality and reporting, the FRTB requires banks to perform more stringent risk calculations, resulting in a potential capital increase if those calculations fail
InteDelta combines a structured consulting approach with subject matter expertise to support a global client base to implement risk management best practice. Our areas of expertise cover the major risks faced by financial institutions: credit, market, liquidity and operational risk, alongside niche specialisms such as collateral management and regulatory change. Our clients have a global spread, ranging from some of the world’s largest banks and asset managers to developing market banks, hedge funds and risk software vendors.