In sum, before other vital Enterprise pieces of Regulatory risk and compliance reporting can be worked upon (say, an integrated corporate reporting system), a few questions to gauge the internal demand for RegTech must be spelled out.

1. Automation of Regulatory reporting in
the Banking and securities in 2022

2. While significant strides in
recent years have helped
streamline regulatory
reporting, the regulatory
burden for banks has
increased at an
unprecedented rate.
For CFOs and CROs, one challenge in this maze of ever-evolving
regulatory compliance is to keep costs in check. Shrinking margins
mean dwindling resources (and budgets) are available to combat
the growing complexity and granularity needed for regulatory
reporting.

3. The problem increases for FIs that operate in more than a single
regulatory jurisdiction. The question for legacy banks is how to
leverage automation to deliver undiscovered value.
This blog article rounds up the changing nature of regulatory
reporting, the need for RegTech, and the leading intervening
technologies in this space.
It would help by tracing today’s business landscape that demands
additional regulatory risk and compliance reporting on banks.

4. FIs challenges in Regulatory Reporting.
• Constantly evolving financial regulations by governments and
other bodies (especially in the aftermath of the pandemic)
• A significant change in the macro-economic climate (triggered
by armed conflicts and other geo-political developments)
• Rising overhead costs on production and implementing
solutions for regulatory compliance.
• The steep fines and penalties for regulatory violations and non-
compliance(s)
• Burdensome legacy systems that resist integration with
modern automation and digitization solutions.
• Fragmentary organizational culture often results in non-
standardized approaches and process inefficiencies.
• The listed problem statements call for a radical approach that
favors open architectures and hyper-precision.
But before we get down to the technology enablers that hold
promise, let us understand how the situation is not about costs
alone.

5. Post the pandemic, regulatory reporting in banking and securities has
taken an additional responsibility – adding value to the business
through Marketing Intelligence (MI) insights and offering customer-
centric insights.
Unsurprisingly, compliance operations use more RegTech to gain
greater visibility into future regulatory demands. Also becoming
mainstream is the emerging tech areas of Distributed ledger
technology, Advanced analytics, Robotic Process Automation (RPA),
and Cognitive computing.
In all of this, the goal for leading FIs is common: Implement strategic
end-to-end reporting solutions – from extracting input data to
performing regulatory computations, generating regulatory returns,
and producing MI for analysis wired into business strategy.
RegTech is more than costs and efficiency.

6. Having a strategy is one thing, but gaining a deeper
understanding of the tech enablers is another. Next, we look at
how a successful RegTech approach leverages (or experiments
with) use cases and scales faster with reduced costs and risks.

7. Cloud Computing: When central servers connect to a network of
remote computers (as opposed to maintaining infrastructure in-
house), the FIs make significant cost savings, amp up their agility,
and elevate adaptability to integrate with a slew of (established
and emerging) technologies that we explore next.
Blockchain Technology. Using ‘smart contracts and shared
data, Blockchain technology eliminates costly intermediaries in
processing and calculates contract cash flows and revenues in
real-time. The use cases for this emergent tech are centered on
reducing the time (and resources) spent in validating
transactions.
Robotic Process Automation. Consider the routine and repetitive
tasks like reconciliations, monthly closing, and preparation of
automated financial statements to achieve efficiency, and cost
savings and free up the use of human expertise for complex
activities.
Advanced Analytics. From intelligent dashboards that report
performance management to forecasts of business metrics
related to budgeting, treasury forecasts, cash flows, and
commodity prices, Predictive and BI tools help FIs predict future
outcomes and organize data into trends and patterns, often
through intelligent visualization.
Developing Robust FinTech solutions for
Automating Regulatory Reporting

8. Conclusion
In sum, before other vital Enterprise pieces of Regulatory risk and
compliance reporting can be worked upon (say, an integrated
corporate reporting system), a few questions to gauge the internal
demand for RegTech must be spelled out.
• What percentage of time does the finance team spend on
repetitive, routine, and unproductive tasks?
• What is the degree of complexity and changes in recurring tasks
– monthly recons and closing report?
• Does the present regulatory reporting involve significant
manual hand-overs and data inputs?
• In terms of accuracy, and error rates, are the metrics showing
an improvement or not?
• What is the quality of data visualization for leadership decision-
making?
Answering these questions (and identifying the improvement
areas) is a good starting point for banks to formalize their RegTech
mandates.
OCR and ML. Finally, the technology that has been in use for some
years now in regulatory reporting is optical character recognition
and the associated Machine Learning engines. These tools
accelerate data analysis and increase output accuracy, the vital
levers to cost optimization. Additionally, monitoring thousands of
transactions in real-time brings handsome returns to the bank’s
tech investment..

9. Contact Us
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Original Source: https://maveric-systems.com/blog/automation-of-
regulatory-reporting-in-the-banking-and-securities-in-2022/
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