Responding to a Dynamic Regulatory Environment

March 31, 2004

Abstract

Paris, France New York, NY, USA 31 March  2004

: IT Evolves to Support European Regulatory Reporting

Celent finds that regulatory pressures and advances in risk and financial management are encouraging banks to leverage a common data-centric architecture.

Financial institutions are dealing with an almost overwhelming number of new regulations and supervisory guidelines, notably Basel II and CAD3. The disciplines of risk and financial performance management are converging in order to help banks to make better business decisions, and increase the transparency of risk and financial profiles to regulators and the marketplace.

In a new report, " : IT Evolves to Support European Regulatory Reporting," Celent examines the history of regulatory changes in Europe and beyond, and how the latest batch of changes are affecting existing technology architectures and strategies at the world's financial institutions.

Celent demonstrates that financial institutions need to accept that supervisory rules will remain in a state of continuous flux as new financial and risk management best practices are adopted and disseminated globally. Banks therefore need to keep their audit and compliance processes and related systems flexible to meet the growing demand for information. The growing number of technology solutions will require banks to find a vendor that can truly act as a partner.

"Solution providers are rapidly adding on functionality or partnering with other vendors and system integrators in order to meet the ever-growing requirements of the financial institution," says Michael Haney, a senior analyst at Celent and author of the report. "Firms are looking to leverage a common platform for risk management, performance measurement, customer analytics, and regulatory reporting," continues Haney. Celent sees spending for such solutions continuing to grow and reach almost US$2 billion globally.

The report concludes with a case study of FRS Financial Analytics, which is being used to help a top European universal bank meet its analytics and reporting requirements. The 38-page report includes 6 tables and 14 figures. 

A is available online.

of Celent Communications' Retail Banking, Wholesale Banking, Retail Securities & Investments, and Institutional Securities & Investments research services can download the report electronically by clicking on the icon to the left.  Non-members should contact info@celent.com for more information.

        

Send mail to info@celent.com with questions or comments about this Web site.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

 

New York, NY, USA March 31, 2004

Regulatory Environment

Return to report Abstract

 

INTRODUCTION 3
CONTINUOUS REGULATORY CHANGE 4
  Five Phases of EU Banking Integration 4
  Rule Adoption Takes Time 7
  Remaining Obstacles to Single Market 8
  A Deluge of Regulations 9
INCREASING REPORTING AUDIENCE 16
  Regulatory Structures Vary Globally 16
  Internal Risk & Performance Reporting 18
  Increasing Frequency of Reporting 19
THE CIO'S RESPONSIBILITIES 21
  IT Internal Controls 21
  Business Case 23
  Supporting Technologies 24
  Emerging Technologies 26
  End-To-End Packages 27
FRS CASE STUDY 30
  FRS Financial Analytics Suite 30
  FRS European Implementation 33
CONCLUSIONS 36
OBJECTIVITY & METHODOLOGY 37

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