24
CAPITAL MARKETS TECHNOLOGY TRENDS Capital ideas: Cloud, AI, blockchain
The capital markets industry is in a constant state of flux. As well as changing market forces impacting the sector at every turn, the space is becoming more and more competitive and cost pressures are ever intensifying. Firms are scrambling for the best way to keep up with the times (and regulations), and that means diversifying how they operate. Alex Hamilton reports
that is awash with data, yet getting value out of that data remains a tough challenge. Research from Capgemini shows that for a firm with around $100 billion in annual revenue, $840 million is spent on the management of data, with a further $260 million on data providers. What’s more, only around 50-60% of the applications companies are equipped with comply with data governance tools and standards. 81% of those working in wealth want better digital tools for their jobs.
C
“Firms are recognising that understanding data is a game-changer,” says Louis Lovas, Director of Solutions at data management firm OneMarketData. “The sheer breadth, depth and interrelated nature of global markets demands more intelligent techniques to obtain insights that can lead to better trade models, improved control of trade costs and surveilling trade activity for malicious behaviour.”
Real-time data control is something that lies at the heart of many regulations that we are seeing emerge today – including MAD II and BCBS 239, says Ian Manocha, CEO of enterprise data firm Gresham. “The link between data accuracy and timeliness is key, with a particular focus on real-time reporting. In today’s highly regulated post-crisis world, financial institutions desperately need the ability to deploy new controls quickly and cost effectively, in response to short timescales for compliance.” Legacy systems, which Manocha describes as “monolithic”, simply can’t cope anymore and it would
www.ibsintelligence.com © IBS Intelligence 2016
apital markets has always been a sector
be a mistake for companies to “take a sticking plaster approach to compliance” - the potential cost of ignoring gaps in their data processes is far too great.
The “burden” of regulation is something that firms have to deal with as a constant, increasingly complex bugbear. The multitude of overlapping regulatory frameworks requires an almost superhuman level of global overview. A PwC survey shows that, of 261 C-level respondents, just over 80% believed that only “some” or “few” capital markets players and early adopters would be able to truly master regulatory integration by the year 2020. Furthermore, more than half of those questioned said that at least 6% of their headcount is devoted to risk, regulation and capital oversight. Half again said that they either raised all available capital, or needed to raise more capital, to become compliant with their region’s regulations.
“Regulatory dictates are the driving force behind many recent data management technological innovations,” states Lovas. Current and future market regulations will create a “throw-nothing-away” mentality, he adds – firms will need to shore up their database technology, security, entitlement and audit trails.
How best to handle these problems is a question that leaves some feeling a little perplexed. With data this is especially the case when the dreaded “cloud” is mentioned. Capital markets firms have traditionally always relied on self-contained proprietary infrastructure,
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52
