In an extremely volatile financial environment, due to the pandemic, banks and financial institutions have been called upon to adapt rapidly to a new reality where they need to manage their credit risk while complying with the new imposed regulations.
The challenges for Banks
With the Basel III reform, as recently stated by the EU Banking Union the regulators target to enhance comparability and transparency of banks in terms of RWAs, while reducing their excessive variability. Thus, the banks which utilise internal modeling to calculate RWAs, might not deviate by the “aggregate output floor” imposed as a standardised approach.
Additionally, as new regulations like CRD II and Basel IV are around the corner, the modernisation of traditional legacy systems towards a holistic view and thorough reporting from various sources and digital channels become a necessity, following today’s market needs.
New opportunities for Risk Management
Automation, risk migration and transparency across operations become the challenges that need to be addressed to accomplish efficiency and streamlined processes. Risk Management Industry needs to re-assess the ROI of the current systems used and how the latter can help them efficiently calculate risk and generate regulatory and management reports according to the new standards.
With change comes opportunity! Regulatory reporting can be a significant source of information, from which banks can create strategies to streamline their operations. A ground-breaking Risk Management Platform can provide seamless integration with the existing legacy systems, while offering centralisation of data for more efficient management and end-to-end automated regulatory reporting, enhancing data reconciliation, aggregation and standardisation.
The future of Risk Management is Scalable and Modular
Covering fully the Pillar I requirements, as well as Liquidity Risk, Large Exposures and Leverage Ratio, Risk Avert the robust and innovative risk management solution, has helped banks and financial institutions globally, to experience complete automation throughout and powerful reporting, embracing the exciting opportunities digital transformation brings to the financial sector.
Find out how you can streamline your processes with a solution that grows as your business grows, enhancing the potential of your legacy system.