The Future of Risk Management

McKinsey published a report on the Future of Bank Risk Management which we believe agrees with some of our own long term views.

Rami Cassis, CEO of Razor Risk Technologies said:

“McKinsey have identified a trend we have observed for some time. Firms need to use analytics, trend tracking and business scenario analysis to navigate through regulatory requirements. However this is easier said than done with some of the basics like access to source data and origination sometimes still missing.

Margin pressures always go up while the cost of capital increases with regulation pushing firms towards a different product mix. Providing business leaders with data, or even information, is not enough. It must be translated into actionable recommendations.”

Peter Walsh, Global Head of Sales said:

“Increasing regulation and model risk are two areas we have a focus on. Firms need to aggregate their risk data and ensure effective controls are in place over the quality of the data being held. This leads directly to more efficient regulatory reporting, but more important accurate pricing and compliance with relevant regulations.  We have helped firms solve this problem for many years as a fundamental foundation of a strong risk management platform”

“Recent discussions with clients has verified this in certain areas which we are focussed on including advanced analytics/ machine learning, and enhanced risk reporting. We aim to help firms make cost savings by reducing operational expenses and streamlining risk business units through integration of market and credit risk and by focussing on optimisation of capital and regulatory compliance.”

You can read a summary of the report by following this link, and the full report is available for download by scrolling down.

Link:  https://www.mckinsey.com/business-functions/risk/our-insights/the-future-of-bank-risk-management?cid=soc-web

P.S. The paper is from the end of 2015 but the themes and ideas are still valid.

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Peter Walsh

Global Head of Sales at Razor Risk

Peter is a banker by trade (ACIB) and a qualified practitioner in managing IT intensive programmes allied to a lifetime of City-based roles and experiences. His experience and knowledge of the risk management and management disciplines helps provide clarity – and, with his background in banking, regulatory compliance and risk systems he is uniquely placed to discuss and describe how technology enablers can be deployed to deliver effective and efficient solutions in the most demanding situations, including the bewildering array of regulations and changes that will be affecting collateral, margining and associated risk management.

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