Dealing with regulatory-led technology transformation in Financial Services

The pace and scale of regulatory change has been unprecedented since the 2008 financial crisis and the rate of that change is still continuing. The Financial Services (FS) industry has seen an introduction of a myriad of regulations over this period. Some of the most recent ones including MiFID2 (Markets in Financial Instruments Directive) and PRIIPS (Packaged Retail and Insurance-Based Investment Products).

This has presented an on-going challenge for the Financial Institutions to maintain compliance in an increasingly regulated environment. At Wavestone we have seen that many organisations take the ‘path of least resistance’ by bolting on systems and processes around the edges of legacy systems. Although it seems a lower risk option in the short term, it does not solve the fundamental problem at the heart of the bank’s infrastructure. In fact ‘plugging the gaps’ or ‘point solutions’ to maintain regulatory compliance adds further layers to IT systems and increases the complexity of the bank’s IT systems in the long term.

At Wavestone, we advise Financial Institutions to meet this challenge by taking a holistic approach by understanding and focussing on the key themes and trends that string the myriad of regulations together.

In this video below, Mathew Wells and Marlena Zakrzewska discuss this issue in more detail. They identify the key challenges facing the CIOs and CROs in 2017, which include; regulatory-led change management, IT systems and tools, aggregated data and reporting and infrastructure resilience. They also discuss how technology can help meet the regulatory change agenda and how organisations can meet the challenge of dealing with regulatory-led technology transformation.

 

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