Not only have the operational challenges of remote working and market volatility stretched reporting teams to their limit since the beginning of the pandemic, financial institutions are expected to ‘do more with less’ whilst still complying with complex regulatory demands and operating under increased scrutiny.
Many banks will have come to the realisation that it is the integrity – or lack of – in their underlying data which holds the key to regulatory reporting success. Teams working during lockdown often struggled to get the access they needed to data sets, leading to manual workarounds or the creation of additional data sources which complicates processes and increases the risk of errors.
Market volatility has also forced many firms to confront their legacy systems. Many have known for some time that these systems are at breaking point, unable to cope with large volumes of data or pressing timelines. As trading volumes have increased in response to market volatility so have the number of positions to be reported, and many teams have found themselves confronted with error rates unlike any that they have seen before. This has driven many firms to take action before the failure of a legacy system which is long past its best.
The full economic consequences of the pandemic are yet to be felt but it’s almost certain that financial institutions will be keeping a watchful eye on costs for the foreseeable future. With spending on regulatory compliance continuing to hit all time highs, many are looking at how they can make their reporting more efficient. Major regulatory change initiatives on the scale of those seen post-financial crisis are now the new normal, and banks are determined to take a more considered and strategic approach to tackling them, rather than the ‘firefighting’ of ten or so years ago which saw multiple, in-house solutions hastily developed – many of them powering successful compliance, but often at the cost of excessive manpower, both from inhouse IT resources trying to serve multiple areas of the business at once, often leading to manual workarounds and complex fixes.
However, the difference between now and the years immediately post-financial crisis is in the availability of partner support. The regtech boom means that specialist support is more accessible than ever, encouraging more firms to hand over their reporting, as well as the associated data integrity challenges, to providers who can quickly solve these problems and free up resources.
With regulatory change remaining high on the agenda, it’s quite simply the only way that firms will have the time and capacity to focus on running their businesses.
To discover how the Clareti platform can simplify your regulatory reporting, increasing efficiency and reducing costs, click here.