A Deloitte perspective on how financial institutions
can move forward in a regulated world
Seizing the regulatory
opportuni...
Canadian financial institutions weathered the most
recent global financial crisis better than most.
We emerged
relatively un...
Despite that record, Canada’s banks, insurers and other
financial institutions (FIs) are subject to the lasting impact
of t...
Financial institutions worldwide
have scrambled to keep up.
They have responded to this
wave of regulations by making
sign...
No one can dispute the ultimate intent of these
post-crisis regulations. It’s hard to argue against
protecting depositors ...
Because while Canada’s regulatory environment proved
it works very well during times of crisis, the question
now is whethe...
The risk – from either overregulation or overreaction
to regulation – is that FIs will retreat from global
commerce and fo...
It’s time for an attitude change.
Certainly regulation can be a
burden, but it’s also something else:
Opportunity.
It’s time to look at compliance –
and the...
In building stronger regulatory, compliance,
risk management and audit capabilities, FIs
are gaining important new busines...
Use compliance to drive
new ways of doing business.
Simply collecting information that is required by regulators
isn’t eno...
Focus on capital efficiency,
not just capital sufficiency.
In the U.S. and Europe, ensuring capital reserves are
sufficient t...
By contrast, the global crisis didn’t affect Canadian FIs
to the same extent as many of their global peers. As
such, they ...
Push compliance into – and throughout – 
the business.
Traditionally, FIs put compliance in its own “box,” separate
from n...
Integrating compliance into everyday work frees
up the resources and improves overall compliance.
It also enhances the opp...
Get ahead of the regulations.
Embedding compliance increases the chances for
insight into how regulations will affect cust...
Work with the regulators.
Remember: FIs and their overseers share a common
goal. The recognition by Canadian FIs of this f...
This is an opportunity FIs can seize
by helping regulators anticipate and
mitigate risks.
We encourage FIs to communicate
...
And remember,
Don’t be complacent.
The world has changed since the financial
crisis began. Governments and regulatory
bodie...
Engage regulators and share insights.
Shape the regulatory agenda and
reap the benefits for years to come.
For more information
© Deloitte LLP and affiliated entities.
Email us at cafinancialservices@deloitte.ca
or visit www.deloit...
Upcoming SlideShare
Loading in …5
×

Seizing the regulatory opportunity: A Deloitte perspective on how financial institutions can move forward in a regulated world

2,259 views

Published on

Financial institutions that look for opportunities in compliance rather than resign themselves to it can position themselves ahead of the competition. The energy they put into understanding the impact of new regulations on their businesses, customers and risks can be used to drive operational changes.

Published in: Business, Economy & Finance
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
2,259
On SlideShare
0
From Embeds
0
Number of Embeds
204
Actions
Shares
0
Downloads
49
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Seizing the regulatory opportunity: A Deloitte perspective on how financial institutions can move forward in a regulated world

  1. 1. A Deloitte perspective on how financial institutions can move forward in a regulated world Seizing the regulatory opportunity
  2. 2. Canadian financial institutions weathered the most recent global financial crisis better than most. We emerged relatively unscathed.
  3. 3. Despite that record, Canada’s banks, insurers and other financial institutions (FIs) are subject to the lasting impact of the crisis. Since 2008, Canadian and foreign regulators have introduced a tidal wave of new rules.
  4. 4. Financial institutions worldwide have scrambled to keep up. They have responded to this wave of regulations by making significant investments in their risk, capital management and compliance infrastructures and by taking steps to strengthen their organizations’ risk culture.
  5. 5. No one can dispute the ultimate intent of these post-crisis regulations. It’s hard to argue against protecting depositors and policyholders and ensuring the soundness and stability of the global financial system. But it comes at enormous cost. In people, technology, infrastructure, time. And perhaps, most of all, opportunity.
  6. 6. Because while Canada’s regulatory environment proved it works very well during times of crisis, the question now is whether it creates a relative disadvantage for Canadian FIs during times of growth.
  7. 7. The risk – from either overregulation or overreaction to regulation – is that FIs will retreat from global commerce and focus on domestic markets. Such a pullback would curtail the global flow of capital and, with less money available from top-tier institutions, innovation will slow or be stifled in some sectors. Shadow banks and other, less regulated institutions may then step in to fill the void.
  8. 8. It’s time for an attitude change.
  9. 9. Certainly regulation can be a burden, but it’s also something else: Opportunity. It’s time to look at compliance – and the regulatory environment –  in a new way. A strong compliance effort, rooted in a deep understanding of the regulations themselves, can potentially help organizations competitively differentiate themselves.
  10. 10. In building stronger regulatory, compliance, risk management and audit capabilities, FIs are gaining important new business acumen. Here are five ways FIs can take advantage of the new regulatory reality to drive organizational change, efficiency, effectiveness and growth.
  11. 11. Use compliance to drive new ways of doing business. Simply collecting information that is required by regulators isn’t enough. Smart organizations will develop an in-depth understanding of what the regulations mean. Realizing the implications better than the competition is an avenue for offering innovative products that others will not have thought of. 1
  12. 12. Focus on capital efficiency, not just capital sufficiency. In the U.S. and Europe, ensuring capital reserves are sufficient to prevent sudden collapses or near-collapses means FIs have less capital available to invest in growth opportunities. These challenges have forced many institutions to take a long, hard look at which business lines to continue and which to abandon. 2
  13. 13. By contrast, the global crisis didn’t affect Canadian FIs to the same extent as many of their global peers. As such, they didn’t re-evaluate which capital-intensive businesses still made sense. Regulatory headwinds now should force Canadian FIs to examine their books and decide if they should continue business- as-usual or turn their focus to more fee-based services, like wealth management, that don’t demand disproportionate amounts of scarce capital.
  14. 14. Push compliance into – and throughout –  the business. Traditionally, FIs put compliance in its own “box,” separate from normal business and with little engagement between business and compliance units beyond the bare minimum. This limited the opportunity for these groups to work together. 3
  15. 15. Integrating compliance into everyday work frees up the resources and improves overall compliance. It also enhances the opportunities to identify regulatory-enabled initiatives.
  16. 16. Get ahead of the regulations. Embedding compliance increases the chances for insight into how regulations will affect customers, product offerings and business models. Doing so can prepare FIs to adapt before regulations come into force. This may result in a powerful first-mover advantage on new offerings. 4
  17. 17. Work with the regulators. Remember: FIs and their overseers share a common goal. The recognition by Canadian FIs of this fact was a key driver of Canada’s relative stability through the downturn. It also means there exists a respectful and productive working relationship – a stark contrast to some other jurisdictions. 5
  18. 18. This is an opportunity FIs can seize by helping regulators anticipate and mitigate risks. We encourage FIs to communicate their insights and ideas before issues occur and to work with regulators to develop mutually satisfactory solutions before they’re needed rather than after.
  19. 19. And remember, Don’t be complacent. The world has changed since the financial crisis began. Governments and regulatory bodies will play an increased role in financial services for the foreseeable future – we simply won’t be returning to the pre-crisis regulatory environment.
  20. 20. Engage regulators and share insights. Shape the regulatory agenda and reap the benefits for years to come.
  21. 21. For more information © Deloitte LLP and affiliated entities. Email us at cafinancialservices@deloitte.ca or visit www.deloitte.ca

×