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2012 vision: How can banks keep up with change?

Thursday 29 December 2011 – by Georges Bory

Many banks are still relying on technology which is behind the curve but in order to meet regulatory challenges ahead of time, they should invest in adaptable systems now, says Georges Bory, MD and co-founder of software provider Quartet FS.

As we enter 2012 it seems the economic crisis is set to continue, with the unreliability of the euro only exacerbating an already difficult financial landscape.

This economic uncertainty means that the future is increasingly difficult to predict, not least of all in the financial services industry.

In dealing with the aftermath of the credit crisis, governments and regulators are under intense pressure to strengthen financial regulation and market supervision to future proof the financial industry.

Indeed, 2011 saw the introduction of much reform. Basel III, the Dodd Frank Act and the recent acceptance of the Vickers report are all proof points of the fast-paced and increasingly changing world we now live in.

However, regulation is just one way that banks are being hit by new demands as customer needs and wants are also constantly evolving. As such, banks need to be flexible and agile enough to react swiftly to industry change in order to remain both compliant and competitive.

Today’s banks can no longer rely on identifying industry trends as early on as possible and, only then, investing to fulfil the demand with a dedicated production system.

Instead, banks need to be able to react quickly to it, rather than attempting the impossible task of speculating on future measures.

This is easier said than done, yet the fact remains that today certain technology, such as legacy risk and trading systems, simply don’t fit the bill anymore. Much of this was built for a period when the future could be forecasted, with the systems now serving a purpose which is less useful for modern banking.

Moreover, even if factors come together to enable a business to predict a customer trend, it is likely that competitors will see this pattern too.

It is clear that to meet the needs of today’s customer and remain competitive it is important for all industries to continue to invest in better, faster, and more robust systems. So why do many of today’s banks rely on technology that is behind the curve?

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