• Industry News
  • 19 November 2017

Which RegTech utilities are best placed to harness…

Which RegTech utilities are best placed to harness…

“Firms are also increasingly looking at greater use of market utilities for data and reporting. Those firms that have already invested in enhancing their data architecture across multiple asset classes will be best placed.” (EY)

“By harnessing technology to improve and optimize a financial institution’s ability to comply with its regulatory requirements and automate the regulatory compliance process as much as possible, RegTech has the potential to bring huge benefits and cost savings to the investment management industry.” (SimCorp)

“Many asset managers and other intermediaries who lack the scale to invest in systems, may look toward new outsourcing service providers as a way to provide support services and facilitation at the appropriate price points. Parties who outsource will still need to perform the necessary regulatory due diligence and manage operational complexities in the front, middle and back offices. There is a likely increase in industry utilities (e.g., data) as firms look to share costs and leverage regulatory investment.” (EY)

Provided robust standards are established

“Regulatory changes have caused firms to implement new or amended processes across the front-to-back lifecycle in order to be compliant. [ … ] In order for some of these firms to continue to provide the services desired by their client base and to remain profitable, there is a need to adopt a strategy to standardize, digitize and automate front-to-back processes. [ … ] ISDA believes there is a need for industry agreement on the process, behaviors and data elements of the derivatives market. [ … ] Standardization is a core facilitator to both RegTech and FinTech.” (ISDA)

“By identifying data synergies between global reporting regulations (such as EMIR trade reporting and FCA transaction reporting), and building centralized regulatory reporting engines, we believe compliance with MiFID II helps avoid the additional effort of maintaining a decentralized reporting infrastructure. Centralized repositories can also promote data quality and data exploitation.” (Accenture)

“In terms of benefits, the sharing of development costs and maintenance costs across a large user base can lead to a lower cost of ownership. Equally, sharing experience and industry best practice through product enhancements based on user group meetings, and individual customers’ feedback and requests for functional changes, will ensure that your compliance function remains in step and competitive in the rapidly changing compliance space.” (Financier Worldwide)

“Firstly, JWG recommended the establishment of an industry committee to prioritise the key RegTech domains and their requirements, and an implementation steering group for each domain […] For example, regulatory reporting could be considered one RegTech domain. Trade and transaction reporting rules require large financial institutions to track millions of products and thousands of trading systems, resulting in a system with billions of reports that are a challenge to manage well […] Here, a committee could help curate a common canonical data model that could accelerate the adoption of solutions across the sector (e.g., open source data validation rules).” (RegTechFS)