IBM is expanding Watson further into the RegTech arena, pitching the cognitive computing platform as uniquely placed to help banks deal with an increasingly complex regulatory and risk environment.
Current risk and compliance systems are disparate and disconnected, often with varying taxonomies, user interfaces, and skill requirements.
This makes it increasingly difficult to achieve a holistic view, and results in a lack of confidence in what a bank’s real-time obligations and associated responsibilities are. Most importantly, this fails to engage the first line of defence - the employees who need the proper tools to make the best and most informed decisions.
Big Blue now claims to have the answer, a Watson Financial Services RegTech portfolio bringing together AI, IBM's tech and the expertise of Promontory Financial Group, the risk management and regulatory compliance consulting firm acquired in 2016.
A governance, risk and compliance portfolio promises a holistic view of risk and regulation responsibilities. IBM says that users of its OpenPages 8.0 will now be able to more easily interpret complex issues and match them automatically to controls and obligations, as well as analyse losses, emerging risks, and failed controls.
Meanwhile, AI is being tapped to accelerate high-cost due diligence activities and helps risk and compliance professionals more efficiently make decisions in regards to AML transaction monitoring and sanctions/PEP alerts generated by existing systems.
IBM has also integrated Armanta - a recently acquired provider of aggregation and analytics software - into its financial risk solutions, helping banks to more effectively aggregate data across multiple systems in near real-time.
HSBC is already using the new governance, risk and compliance technologies, rapidly scaling OpenPages 8.0 with Watson to their 15,000 users across 70 countries.
"We have already seen strong adoption of the IBM solutions by our first and second 'line of defence' professionals who are eager to use the system in their day-to-day work,” says Cathy Ryan, head, operational risk IT, HSBC. "It’s now easier to identify risk stewards, risk owners and control owners, for example, and enable our teams to address issues much more quickly and effectively."