Driven by SEC modernisation and continually changing regulatory requirements, Confluence is predicting a year of anxiety in 2018, but eventual positive systemic change, as firms work to achieve efficiency while meeting a broad range of back office demands.
Confluence predicts three major impacts across the asset management industry next year: RegTech will make way for a “DataTech” movement in business operations across the back-office ecosystem; the data-intensive focus of the Securities and Exchange Commission (SEC) will spur industry adoption of data analytics in fund compliance and governance; and regulatory anxiety will prevail as the future of new regulations remains unresolved
“We expect significant, measurable transformation across the asset management industry in 2018,” says Todd Moyer (pictured), Confluence’s Chief Operating Officer. “While the implementation of SEC modernisation is the most obvious driver of that change, we believe that back-office professionals will see this as a rare opportunity to transform their operations in a way that goes beyond compliance to harness data in new and powerful ways for their businesses and their clients.”
RegTech will make way for an ecosystem-wide “DataTech” movement in financial services technology. As asset managers have embraced RegTech for the value it delivers by leveraging data across a multitude of regulatory forms, Confluence expects that in 2018 the same impulse will impact the broader fund servicing ecosystem. The result will be a “DataTech” movement in the fund servicing back office where the same data is used to produce a variety of financial, marketing and statutory reports, eliminating process proliferation and redundant data processing.
The back-office process, currently designed and optimised around production of a deliverable, will now be designed and optimised around shared data. With shared data as the focus, operations teams will work to eliminate redundancy by processing the data once and then exporting it in as many formats as needed.
This movement will be a strategic step toward real digitalisation in the fund servicing industry.
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