Researchers at the Boston Consulting Group have estimated that financial institutions must now circumnavigate some 200 regulatory revisions per day – from MiFID II and its 1.7m paragraphs of rules on transaction reporting, to Volcker 2.0, GDPR and the EU’s new Benchmark Regulation – each of those revisions take their own toll.
According to one 2017 Thomson Reuters survey, banks were expecting to devote around 30% of their total 2018 compliance budget adjusting to MiFID II alone.
Compound that mounting compliance burden upon a range of increasing data security and cybercrime threats, it is clear why there is a surge in demand for innovative risk analysis methods.
Fortunately, the advent of big data has meant financial directors are more or less spoilt for choice in terms of new modelling capabilities and risk management solutions. Yet by and large, it’s worth pointing out many of the market’s most dynamic risk analysis methods are still grounded in the basic techniques financial directors have been calling upon for decades.
Same tools, more firepower
Even cutting-edge fintech platforms are still heavily reliant upon basic techniques like sensitivity analysis, scenario…
