This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice for more information on the cookies we use and how to delete or block them.

Global > United Kingdom > Services > Audit > Enterprise Risk Services > ERS in industries > Financial Services

Global site selector

Growth, risk and compliance: Taking a strategic approach to managing reference data

April 2012
1.22 MB
Growth, risk and compliance: Taking a strategic approach to managing reference data
Area: Financial Services

Background

Co-authored by Deloitte and SWIFT and with contributions from Chief Data Officers across the industry, this paper outlines the pervasive impact that poor reference data can have on organisations and makes the case for a strategic approach to managing reference data.

With impact on growth, risk, and compliance, some organisations can see the competitive advantage to be gained from having confidence in their data and, as a result, are appointing Chief Data Officers to ‘police the numbers’. The introduction, driven by the G20, of the common legal entity identifier (LEI), used to identify parties involved in a financial transaction, will have a significant impact on regulatory reporting but could also be the catalyst for firms to take a more strategic approach to data management.

Key findings

While the driver for spend on reference data programmes is often regulatory, the impact of poor data is much more pervasive:

Organisations are demanding increased risk transparency, particularly around the more complex structured products. Chief Risk Officers and risk functions have ever greater influence and are driving demand for accurate and timely data.
Analysis shows that improved data can release 1-6% of Tier 1 capital. Taking a conservative average of 2%, this represents £17b in capital across the largest EU and US banks.
Margins on vanilla product execution are being squeezed and there is an ever increasing need to reduce transaction costs.
Understanding the individual needs of clients and being able to cross-sell/up-sell drives growth and requires accurate information about the client and products held.
Improved data management supports the ability to quickly and economically enter new markets and products.
The financial crisis has led to an ever increasing regulatory burden with significant requirements on accurate and complete data.