The integration of trading, risk mitigation, and collateral management may be the next step for firms, says Sophie Foy from Adenza in this FTF Exchange podcast.
FTF News Chats with Sophie Foy at Adenza
Financial services firms are in a conundrum because they face the dual pressures of compliance with a growing list of major regulatory reforms at the same that they have to meet budgetary constraints and cut costs.
One way to break through that conundrum is for firms to investigate ways to cost-effectively integrate previously autonomous trading, risk, and collateral management operations, says Sophie Foy, the product strategy director at Adenza, the company formed via the merger of Calypso Technology and AxiomSL. Foy is the focus of the latest FTF Exchange podcast.
“So, we can clearly see that all firms know that they have to change and adapt around a few new dimensions,” Foy says. Firms need to optimize their IT investments while complying with new regulation, looking for savings, and bolstering profitability, she says.
In general, firms are falling into two major categories in response to this problem — some firms have been developing and executing on a strategy while others take a more tactical approach and do only what is necessary to be compliant, Foy says.
“Our most successful clients have realized that a strategic approach would require an integrated solution,” Foy says.
The podcast discussion covers:
- The implications of a major shift by sell-side firms away from dealing in exotic, over-the-counter (OTC) instruments to safer, lower-margin transactions;
- High-volume transaction flows that have challenged IT infrastructures and IT management;
- IT transformations away from manual workflows in a high-touch environment;
- The new levels of possible integration among treasury, collateral, securities finance, and risk mitigation operations;
- The lessons learned from working remotely during the COVID-19 lockdown that center on system operations and enhanced application monitoring;
- New tools that use artificial intelligence (A.I.) to sharpen calculations, improve processes, and keep capital costs under control via enhanced what-if analytics;
- And the promise of a more virtualized future.