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These days I hear from many people who work in the regulatory compliance world that they are very busy people, working very long hours, their time being consumed with a number of competing and complex priorities. I will be posting a second blog next week outlining a holistic view to tackling these priorities. Though first I aim to analyse just exactly what these priorities and challenges are, and for many working in regulatory compliance they include:
With all of this on their plate, no wonder those who work in this area are wondering how they can juggle all these non-income earning activities, with no additional budgets for additional systems personnel and subject matter experts.
Recently, such an expert reminisced to me about the days when banking systems were all about debits and credits, and the importance of the 3pm deadlines and “windows” for paper securities. She said that the complexities of option pricing models seems like child’s play when compared with the detail required when on-boarding a new client, or figuring out what the business operating model and technical architecture requirements are for some of these new regulations. The analogy she used, was that it is like trying to tame just one of a racing herd of wild horses.
No matter, this is the situation in which we find ourselves, and we have to move quickly with the times.
However, whereas we now have enterprise-wide counterparty and static “golden source” databases, cross asset class market and credit risk systems, and group general ledger and finance systems, we don’t have many examples of an end-to-end enterprise-wide framework for integrating this plethora of new regulations into a bank in a seamless manner. Most of the regulations identified above are probably being implemented by the department “which is the most affected”.
This was certainly the case for FATCA (where the tax department probably took ownership by default!), and for CRD IV (which was handled by the Finance Department), with all the changes directly relating to customers (e.g. Client Agreements and Legal Entity Identifiers) being handled by relationship managers. Consequently for the Compliance Officers themselves, a ‘regulatory compliance framework’ is certainly required.
This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.
Alexander Boehm Chief Executive Officer at PayRate42
05 September
Alexander Saleh Head of Partnerships at Coincover
02 September
Alex Kreger Founder & CEO at UXDA
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