Despite evolving pressures to monitor external account activity, compare it to predicted activity, then manage any discrepancies and risks that arise, many banks are still unprepared for stricter liquidity compliance.

If real-time intraday control is so crucial, why have so few firms managed to get there? Primarily, because it’s difficult – and traditional IT approaches have failed.

Banks are already affected by liquidity requirements but may lack a clear path to address these regulatory obligations as they continue to evolve.

Addressing intraday control is a necessity for banks to upgrade cash and liquidity management, but many are still unclear on the requirements.

BCBS 248 contains detailed guidance for intraday liquidity risk management, and more recently, regulators are active again and giving attention to this topic.

In the last few years, banks have managed to build tools to report on liquidity, yet as regulations evolve it may be necessary to upgrade systems or change the operational management of liquidity.

New regulations, new challenges

As new regulations come into force, banks are faced with new, and even more, challenges that impact their day-to-day operations. In fact, a report conducted by Deloitte highlights that a large proportion of banking firms are aware of the intraday liquidity regulations and the impact they have on their operations…but where do they start when it comes to putting plans in place to ensure compliance?

Steps you can take now

There are a number of steps that banking firms can take to start their journey to control liquidity risk….here’s where we would start:

1. Develop a business case to justify intraday liquidity enhancements.

2. Avoid developing sole-purpose solutions geared towards producing a single report (e.g., BCBS 248) and instead focus on a comprehensive liquidity and risk management platform and solution.

3. Begin implementation planning and determine a suitable vendor solution that can meet your current – and future needs.

By using innovative technologies to address real-time intraday data challenges, you can implement the tools you need to deliver full control over intraday cash and liquidity management.

If you are a banking firm and you want to learn more about using technology to ensure you are meeting regulatory requirements, then contact us today.

“If you are part of a bank that has any links at all to the UK, then you will be impacted soon enough. If you are outside this sphere of influence then you shouldn’t be complacent, as there is a lot of peer learning in the regulator community, and your local regulator will follow at some point in the future.”

Pete McIntyre, Financial Services Director, Planixs