New data management research published by U.K.-based software company Fenergo and FIMA (Financial Information Management Association) shows that regulatory/compliance data requirements and existence of data silos are top priorities and areas of concern for financial institutions in 2013.
Their report compiles the survey responses of 110 participants at the 2013 FIMA conference held in Boston earlier this year.
The results show that 36% of respondents rank regulatory/compliance requirements with respect to their data management strategy as a top priority for their financial institution this year. In commentary provided in the report, a leading investment bank expressed surprise that this number wasn’t higher given “all of the compulsory work around Dodd-Frank/CFTC requirements, [European Market Infrastructure Regulation] counterparty classification, [Legal Entity Identification] adoption, and other reporting requirements that are so consuming of resourcing, especially in the legal entity space.”
Furthermore, the survey results reveal that the top reference data management challenge facing institutions is the continued existence of data silos, which ranked first and second in severity for 50% of respondents. Over half of financial institutions (51%) claimed that sharing data between different parts of the organization is difficult and requires manual effort for each sharing task, a percentage that has not improved since last year’s report.
According to Marc Murphy, CEO, Fenergo, “Data management is a monumental challenge for financial institutions this year given the amount of financial regulation that is heavily dependent on high quality data for compliance. While this research shows definite strides in the right direction toward eliminating silos, improving accuracy of data flow, and facilitating data sharing across the financial institution, there remains some serious challenges for institutions.”
He continues, “The re-usability of data and documentation across various parts of the institution for multiple regulations is a vital component of being able to comply with regulations simultaneously. To do this, institutions need to eliminate data silos and adopt an enterprise-wide capability that enables the cleansing and remediation of client and/or counterparty data and facilitates data sharing between key parts of the institution with little or no manual intervention. While certainly not an easy undertaking, it is most definitely achievable.”
Fenergo is a provider of counterparty data management, compliance and, client onboarding software for financial institutions.
In other findings, the report also reveals that 15% of respondents claim to have a chief data officer in their institutions, with a further 34% moving toward that direction.