Credit Risk Deterioration – Early Warning Indicators
Regulatory requirements are essential, and are amongst the most substantial and fundamental factors driving the banking business. Any change in regulation may potentially increase the cost of conducting conventional business activity, reduce the appeal of an investment, or change the competitive landscape. Dialogue around compliance is something that has been accentuated of late, as the regulators are proactively seeking to address the recent mishaps in the global financial markets.
Banks need to start being more aware when it comes to the matter of rogue trading. This needs to be for the long term rather than just trying to appease staff, investors and the media in the short term. The preventative methods should be ongoing and a consistent process. It is no longer sufficient to just merely comply with regulation as this has clearly not worked in the past, as this report will outline. Instead, the financial industry needs to wake up to the fact that rogue trading events have occurred and will occur if the organisation’s approach does not change.
Adopting a comprehensive approach to managing technology assets and resources has never been more important. However, using disparate IT related information that spans across the enterprise and converting it into useful and meaningful information may not be an easy task by any means.
FX markets around the world have withstood the events of the past eighteen months surprisingly well. Prior to the fall of Lehman Brothers in September 2008, the total daily volume of FX trades had been steadily growing.
There has been a surge of interest over the past year in finding ways to decrease the power, cooling and space requirements of the data centre. Hardware accelerators are billed as one of the technologies that may be able to assist this. Typically hardware accelerators are far more power efficient than CPUs and due to the fact that they exploit multiple levels of parallelism, they offer vastly increased processing power.
The proliferation of low latency data feeds supporting the growing algorithmic trading market is one of the main drivers for what many people are calling CEP. The extent to which CEP platforms are actually being used and installed within the financial industry is fiercely debated between various reports, press releases, conferences and blogs.
Data management and data cleansing is one of the most challenging and most ignored problems within the financial markets industry. The issue caused by the quality of data is no more pronounced that with the risk modelling and management departments.
In addition to personnel, the expenditure on technology will be one of the most substantial costs that a bank has to allocate for. Similarly it is one of the most important as well, therefore it needs to be researched and selected accordingly to suit the client, product offering as well as the business model.