6 Ways to Dramatically Improve Group Risk

Managing group risk is inherently difficult for financial institutions. Understanding how capital, liquidity, operational, regulatory, market, and reputational risk impact each other means a bank group must have visibility into how the performance of each entity affects the others. Ever-changing regulatory requirements are making group risk even more challenging in every banking environment, particularly those that still rely on manual processes and legacy solutions.

The root of group risk challenges

Many banking groups face similar challenges – multiple departments entering data into models, manual spreadsheet errors, finding mistakes in a 20 million cell model, lag time for running simulations, group reconciliation, and the list goes on.

The common denominator in so many of these challenges is uncontrolled spreadsheets. And despite the efforts to code business-critical processes into enterprise software, workaround processes have persisted. Most banks are still processing data through thousands of spreadsheets.

One solution to a myriad of problems

Risk management departments need a solution that centralizes, connects, and controls business models so they can have true enterprise-wide transparency. To meet ever-changing regulatory requirements, they need a flexible solution where models can be easily updated – without waiting in queue for scarce developer time for months or even years.

Coherent Spark can do exactly that. Spark converts the most complex spreadsheets into APIs that can easily connect to other models and solutions in minutes. And requires no specialized programming skills.  With a wide range of capabilities, Spark provides automation, End User Controls, transparency, and governance that enables: 

1. Rapid Model Development: Develop and launch new risk and scenario models in days. Regulatory changes that could take six months or more to code, test, and implement with traditional processes can be done in weeks with Coherent.  

2. Increased Simulation Capacity: Once models are in the Spark platform, analysts can easily run millions of tests, including stress tests and back tests, in minutes. Spark maintains the flexibility of Excel, while enabling enterprise-level scale, so banks can quickly identify potential risks and take action. 

3. Enhanced Transparency: With a comprehensive audit log of models and simulation runs, Spark provides full transparency and accountability across the entire organization. This is essential for meeting regulatory requirements and providing confidence to auditors.

4. Integrated Models: By connecting Excel with other models built in Python or SAS, Spark streamlines analytical processes and provides a unified, interconnected view of risk. Exactly what every group risk team needs

5. Reduced Errors from Automation: Spark seamlessly connects with LC/NC tools, such as MS Power Platform and MS PowerApps, so you can manage data and assumptions separately from calculations. This fully automates your risk management processes and eliminates end-user computing errors.

6. Efficient Resource Allocation: Spark converts complex spreadsheets to code in minutes without IT resources. Banks can save months of time and expense in coding and testing, and allocate scarce developer time to other critical areas.

Streamlined, flexible, transparent processes 

Group risk departments face difficult and dynamic internal, market, and regulatory pressures. Keeping daily operations running while trying to address outdated systems and processes is problematic. Teams are likely fatigued with never-ending transformation projects. Next-generation solutions like Coherent Spark enable organizations to solve the challenges of uncontrolled spreadsheets and legacy systems without a multi-year transformation process. 

Excel has remained the tool of choice for most financial analysts, but it was never designed to be the data management solution that it has become at many banks. Coherent Spark elevates Excel to provide the streamlined, flexible, transparent processes that every group risk organization needs.

Ready to elevate group risk?

If your group risk team needs to control uncontrolled spreadsheets to increase transparency across entities and meet regulatory requirements, Coherent Spark could be the solution. Connect with us to set up a free demo.   

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