![Risk.net](https://www.risk.net/sites/default/files/styles/print_logo/public/2018-09/print-logo.png?itok=1TpHrpuP)
Banks need to focus on Pillars II and III says Celent
Banks may be over-emphasising the requirements for Basel II’s Pillar I, which sets the standard for risk-adjusted capital adequacy ratios, while overlooking the importance of Pillars II and III, which cover topics such as corporate governance, according to a report released this week by Boston-based research and consultancy firm Celent.
The report also found that a bank’s implementation of Basel II technology directly correlated with regulations of the institution’s home country. European banks have been quicker to adopt the new regulation than banks in the US, which has delayed its adoption of Basel II again.
The Netherlands and the Nordic countries are furthest in their progress, compared with southern Europe and smaller financial institutions in the UK that have recently accelerated their efforts in anticipation of the 2007/2008 deadline.
Furthermore, banks that are required to abide by Basel II are focusing on managing economic capital, which they view as a strategic advantage, while in comparison, non-mandatory banks are more concerned with regulatory capital, Celent found.
A corresponding trend shows that mandatory banks, on average, have been using different vendors to find the 'best of breed' components, while non-mandatory banks are using the technology that combines many functions into one package.
The firm also analysed the leading technology vendors and detailed each of their strengths in terms of Basel II functionality. In terms of asset size and number of installations at Tier I banks, five vendors came out on top – Paris-based Ubitrade Fermat, Toronto-based Algorithmics, North Carolina-based SAS, Pennsylvania-based SAP and Pennsylvania-based SunGard. Mumbai-based i-flex/Reveleus solutions has also gained a strong presence in the US.
Regional trends are also evident. In Asia, SAS, SAP and Fermat have the most clients across all tiers of banks. In Europe, it is the same set of players plus Algorithmics and SunGard. However, the top three vendors in north America are i-flex/Reveleus, Algorithmics and SunGard. “The point here is a lot of vendors are very close in terms of capabilities,” says Ding. “There isn’t an overall winner. It depends on the line of business of the institution and the technical architecture within the bank.”
Risk NewsOnly users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Risk systems
Chartis RiskTech AI 50 2024
A Chartis report exploring the landscape of artificial intelligence and its adoption in the financial services
Identity verification solutions 2023: market and vendor landscape
This report analyses the current identity verification solutions landscape and examines the key market trends, regulatory drivers and vendor strategies shaping it
Taking the lead on financial crime regulatory compliance
Increased scrutiny of anti-money laundering and customer due-diligence procedures means banks must create more efficient and effective systems. A recent webinar conducted by Risk.net and IBM discussed how leading banks are utilising artificial…
AI wide open
The Risk Technology Awards 2018 have highlighted how new technologies are bringing recognition for vendors
Murex moves flagship trading and risk system on to cloud
Vendor expects more demand from squeezed banks; move also hints at modular future for risk systems
Sponsored video: Philip Moyer, Amazon Web Services
Philip Moyer, Enterprise Cloud and Financial Technologies, Amazon Web Services, discusses the biggest government, regulatory and compliance (GRC) challenges organisations face today, how moving to the cloud can help firms prevent potential cyber attacks…
Cloud control
Sponsored feature: OpenLink
Algorithmic execution: Harnessing technology to manage risk
Sponsored feature: HSBC