Meanwhile, the fully loaded cost of risk and compliance has been rising across the banking industry to an estimated global total of $210bn in 2006. In addition to unnecessary duplication in technology, more than 80% of this cost is still comprised of direct administrative expenses (compliance, risk management, operational and financial controls) and includes the administrative overhead that is also loaded on most line and management functions.
Integrated business and technology architectures allow banks to deliver new value to their customers in the form of new or linked products and services that are personalised to their lifestyles, preferences, financial profiles and behaviour patterns. Therefore, banks have been seeking opportunities for improving the customer experience while making visionary investments in integrated risk management and compliance solutions. These integrated architectures implement best practices and also lay a robust foundation on which to build successful business strategies around operational efficiency, process excellence, organic growth and customer value.
Guillermo Kopp, is vice-president of Financial Services Strategies and IT Investments at TowerGroup.
