TORONTO, Oct. 16 /CNW/ - Algorithmics Incorporated, an international leader in enterprise risk management solutions, today presented the enhanced Basel II offering delivered in its latest version Algo Suite 4.4 at the company's Algo Credit Conference in Madrid, Spain. Developed in consultation with a group of early adopter clients - including some the world's largest financial institutions - the Basel II functionality within Algo Suite 4.4 provides comprehensive functionality to support the data consolidation, computation, and reporting requirements associated with the Accord. This integrated and scalable suite of enterprise risk management solutions includes support for market, credit, and operational risk across wholesale, retail, and trading operations. Leveraging its open architecture and enterprise-wide approach, Algo Suite also provides the transparency necessary to support the supervisory review and market discipline requirements of Pillars II and III.
Algorithmics' early adopter clients include HSBC and the Royal Bank of Scotland. HSBC has had a long history with Algorithmics, utilizing Algo Suite
solutions within its Investment Bank for a number of years. The Royal Bank of
Scotland (RBS) selected and began implementing Algo Credit for global limits
and exposures management in May of 2003.
"Involvement with Algorithmics from an early stage has allowed us to play a role in the development of this leading solution to address the divisional and group level requirements of the three Pillars of Basel II," said Laurie Mayers, Group Head of Basel II and Credit Risk Systems Coordination at RBS, one of Algorithmics' Basel II early adopter clients. "Algorithmics will serve as a core part of our data storage and aggregation platform for our Basel II risk architecture at the Group and core wholesale bank level."
"Involvement with our early adopter clients has been a significant asset in the development of Algo Suite 4.4 and preceding versions based on the 4.0 architecture," said Michael Zerbs, Chief Operating Officer at Algorithmics.
"We are delivering a solution that is definitely ahead of the curve, providing
significant Basel II functionality based upon our industry-leading
By providing a detailed breakdown of risk-based capital across the enterprise, Algo Suite helps institutions improve the management of regulatory and economic capital. The scalable and extensible architecture of the solution facilitates Basel II compliance, but also goes far beyond, to provide a solid framework for sustainable, extendable and cost-efficient long-term risk management and profitability.
Algorithmics' risk framework is based upon a robust, three-layer infrastructure that provides reliability, sustainability and flexibility. It is designed to integrate in a non-intrusive manner with other systems via a consistent and self-documenting interface. The system can be scaled and extended to accommodate the unique approaches, processes and methodologies of each business area. Algo Suite thereby facilitates business processes through cross-functional, transparent risk management.
Data Collection. Algo Suite provides consistent, verifiable measurement of risk across the entire enterprise by linking disparate forms of exposure across the multiple business lines, portfolios, products, risk types and geographies. With a uniform point of entry, the data and data services layer captures and reconciles all global positions in both the banking and trading books, providing a single representation of all financial instruments and counterparties.
Risk and Capital Calculation. Based on Algorithmics' Mark-to-Future framework, the analytics and simulation layer enables the distribution of complex risk and capital calculations across multiple processors. This allows each individual institution to trade-off speed and cost. Using the same advanced analytics typically reserved for end-of-day assessment, Algo Suite's real-time analytics and pre-deal limits tools provide scalable front-office support to multiple users across the organization.
Reporting. Under the new Accord, firms will be required to monitor the workflow required for proper reporting, and to audit, store and re-create any data changes made throughout the organization. Algo Suite for Basel II emphasizes the workflow in reporting as much as the numbers that are reported.