IMPROVING EFFICIENCY IN ADDRESSING REGULATORY COMPLIANCE
R&C: Could you provide an overview of prevailing trends within the regulatory compliance arena over the past 12 months or so? In which areas is there still ‘slack’ in the system?
Kimner: Many regulators are settling into more of a cadence around issuing new or updating existing regulations – including publishing guidelines, instructions and submission requirements. The frantic pace of introducing regulations, post-crisis, has slowed considerably over the last year. The more notable changes recently for financial institutions (FIs) have come from the International Accounting Standards Board and, in the US, the Financial Accounting Standards Board, with their updates to determining expected credit loss – IFRS 9 and CECL, respectively. Even with the pace of regulations slowing, many FIs continue to approach compliance as a ‘check-the-box’ exercise and are willing to live with a sort of ‘status quo’ with overly complex or inefficient processes. Proactive FIs, however, are looking to pull costs out of the equation and improve efficiency. Other areas being addressed include increasing the effectiveness of regulatory investments across business lines, streamlining the collection, storage, retrieval and sharing of data across divisions, and rationalising processes and controls to simplify workflow and governance.
Jan-Mar 2018 Issue