The consistent theme of hefty fines being brought down upon the banking and financial services industry by global regulators is resonating across all areas of business. The impact of the global financial downturn is still reverberating throughout financial institutions in the shape of numerous regulatory changes calling for a clarification of risk data. Where those operating in financial risk function are thus concerned, the issue of tighter scrutiny from regulators in fact lends itself to a stronger, more saturated market for financial risk jobs in the UK and Europe, as well as globally.
The industry is in stark need of risk data that is not only accurate, timely, consistent and aggregated across the business, but also delivered via a technology that supports an analytical collection of the data. The current regulatory climate is calling out for financial services enterprises to utilise technology-driven approaches to risk data as the Basel III Accord January 2016 deadline places greater pressure on banks to upgrade their systems for measuring and managing risk appetite.
According to a senior risk officer in the banking industry, “the three biggest challenges in risk management today are having the right data and technology in place to help measure risk quickly and efficiently”. Institutions need to improve their risk management platforms to not only stay current but also to provide an effective shield to mitigate critical risks during times of stress or crisis in a timely fashion.
The advent of blockchain technology, the digital ledger software code that powers digital currency bitcoin, is fast proving itself to be the answer to the banking world’s prayers. The Bank of England, in a report earlier this year, heralded it the “first attempt at an Internet of Finance”. Dissolving the age-old clunky back-office processes for financial transactions, which on average take 2-4 days to go through, blockchain technology is offering the speed and transparency demanded by customers and regulators alike. And, while the instantaneous nature of blockchain technology and its low running cost are deeply attractive, so too is its ability to integrate more security into modern day banking.
Financial risk professionals and actuaries coming from a client-driven, agile working environment will find themselves in most demand amid this changing financial frontier. Bringing to the table an aptitude for forensic accounting and investigative skills as well as the ability to approach projects with both technical and analytic understanding, in addition to excellent communication with shareholders and strategic thinking will serve candidates well in securing opportunities in financial risk across the UK and Europe.
Many institutions are working on improving the design of their infrastructure, as well as their approach to governance, to better track the quality of their data and how it is implemented across different areas of the business. Financial risk candidates with a talent for forward-thinking, specifically concerning trend forecasts to the changing technology climate, are in high demand as organisations prepare themselves for financial regulation likely to come. Professionals coming from a background in financial crime, compliance and general risk management are highly desirable, as the banking and financial services industry opens itself up to a more technology-driven and cutting-edge job market.