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Welcome to a new world! Following a phase of brutal consolidation, investment banking will be carried out by a handful of huge commercial banks themselves under direct or indirect control of governments or regulating authorities.
Bank and asset management businesses will be “re-siloed” in ecosystems defined according to risk environment, regulatory requirements and technical constraints. This will improve their agility, make their risk manageable, allow for transparency and simplify disclosure policies -at least this what we would like to think.
From an IT and risk management perspective there will be focus on
-Electronic trading and clearing. Those derivatives which can be standardised and simplified enough to go to clearing houses will survive. The rest will go. Expect massive downsizing.
-Outsourced valuations of derivatives and complex instruments (they won’t trade but will need portfolio valuations)
-Active systems for cross-asset margining (net collateralized exposure in real-time or near time)
-Active systems for portfolio concentrations (industry, currency, credit, risk factors)
-Next generation risk architecture (re-engineering information flows, desktop. data mining, search, risk dashboard, etc)
This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.
Edvards Margevics Co-partner at CONCRYT
30 August
Ellen Roberson Global Marketing Advisor, Risk, Fraud & Compliance at SAS
Patrick Bermingham CEO at Adflex
29 August
Ben Lane VP of Colleague Experience Group at American Express UK
28 August
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