Critical Roles For Analytics In Finance
According to 2020 statistics from the European Commission, the value of the data economy in the EU member states and UK was estimated to be in excess of €440bn. Organisations poised to win in this environment must have a high level of competency in analytics, and a foundation stone of high quality data.
With data of high quality comes the potential for analytical insights that yield greater operational efficiencies, product innovation, and improved customer services. Effective and timely analytics also help reduce the risk of fraud, and increase the accuracy of financial and regulatory compliance reporting.
In the finance sector, a number of key players are deploying innovative technologies and sophisticated analytics to beneficial effect.
Deutsche Bank Is Using High Quality Data To Deliver Insights And Predictive Analytics
Several factors can contribute to a reduction in data quality, including:
- A diversity of data formats
- Poor technology infrastructure
- Unclear chains of data custody and ownership
- A lack of integration between data management processes
To address such issues, Deutsche Bank created a Technology, Data and Innovation (TDI) division in October 2019. By developing in-house talent and bringing processes that were previously handled by third parties into the organisation, its aim has been to enable innovative solutions that benefit the bank and its customers.
The TDI works in tandem with Deutsche Bank’s Chief Data Office (CDO). This is an enterprise-wide endeavour which seeks to make data an asset, and to accelerate the development of information-related products. It began with a drive to improve data quality management and governance. Rather than focusing simply on managing information as a tool for preventing financial crime and safeguarding customer privacy, the initiative has the proactive goal of developing new insights and capabilities for the bank’s clients.
Deutsche Bank views cloud capability as critical for exposing client-facing analytics, and for facilitating collaboration. The second phase of the Deutsche Bank Data Quality Platform includes detective controls or ‘Data Contracts’ which mediate between the Corporate Bank and the Group’s Treasury, Risk and Finance teams. For its part, the Corporate Bank is constructing a Data Factory -- a hybrid solution with some components housed in the bank’s physical platform, and others resident in the public cloud. In January 2021, this Data Quality Platform received the TMI Best Data Management Innovation Solution award.
Not content to rest on these laurels, Deutsche Bank has been taking further steps to modernise and accelerate its data technologies. In June 2021, the bank announced a partnership with Oracle. This multi-year agreement will enable Deutsche Bank to upgrade its existing database systems, and migrate the majority of its Oracle Database holdings to an on-premises deployment option. This deployment will serve as a vehicle to deploy and scale critical functions such as payment processing, regulatory reporting, risk management, and trading.
Under the terms of the agreement, both companies will also collaborate on a joint innovation partnership. This aims to investigate potential applications for AI, blockchain, and data analytics technologies in designing new financial services and products.
Santander Is Using Blockchain Analytics For Cryptocurrencies And Extending New Revenue Management Options To Consumers
In partnership with risk management organisation Elliptic, Santander is using blockchain analytics to investigate the risks associated with cryptocurrencies and digital assets. The bank has recently concluded a pilot scheme employing Elliptic technology to identify suspicious activity relating to cryptocurrency transactions. The platform covers 97% of cryptocurrency transactions by trading volume, and was constructed from a data set of over 10 billion data points.
This reflects the ongoing interest and involvement of Santander in the cryptocurrency realm. The bank publishes educational materials on cryptocurrencies for its consumers. And in 2020, Santander became the first bank in the UK to use Ripple for developing a real-time system of cross-border payments.
Elsewhere in the technology space, the commercial division of Santander Bank is collaborating with health care remittance provider Revenue Management Solutions, on a new product for consumers. The package enhances data analytics and automates revenue cycles for health care institutions and life sciences companies. It’s a digital health care “lockbox” which increases productivity and efficiency, and reduces operating costs.
At the consumer/investor level, Santander UK has recently launched a new cash management platform, built on Infosys Finacle technology. Its first phase gives users a global view of their liquidity. The platform offers visibility into cash positions, reporting at account and transactional levels, and foreign currency movements by country. Future iterations of the solution will incorporate self-service digital features for managing, controlling, and mitigating cash and business risks.
Lloyds Banking Group Is Investing Strategically In Public Cloud, Machine Learning, And Advanced Analytics
In 2018, Lloyds Banking Group made a commitment to spend £3 billion on digital transformation, for its GSR3 initiative. Between 2018 and 2020, Lloyds spent £4 billion on technologies to modernise its operations, integrate payment mechanisms, and become more data-driven.
As of 2021, the Group has 17.4 million active digital users -- a figure that has grown 30% since the onset of COVID-19. Their average customer logs in 26 times a month, from a base of 12.5 million mobile app users. These consumers are being served by a cloud infrastructure that gives a 30% reduction in the time it takes to deliver new features. Over 50% of customer transactions are currently enabled via machine learning technology.
For its Strategic Review 2021, Lloyds Banking Group is making priority investments in data capabilities. Advanced analytics are targeted for a number of use cases spanning multiple products. These analytics tools will for example provide early insights into financial vulnerabilities, and enable the group to offer more personalised options.
Want to hear more from Lloyds, Deutsche Bank and Santander on Analytics?
Joining us at FIMA 2021 live and in person this November. We have;
Day Two, 09.00am - 10.00am
CDO Case Study Interactive – How Can You Drive More Impactful Decisions from Your Data and Analytics?
Roshan Awatar, Group Chief Data Officer, Lloyds Banking Group
Day Two, 12.00pm - 12.30pm
Analytics Keynote with Q&A – Rethinking How to Scale Analytics and Leverage Trusted AI across Your Global Firm for Enhanced Decision Making
Ray Richardson, Group Head of Advanced Analytics, Deutsche Bank
Day Two, 15.10pm - 15.50pm
Science and Analytics Fireside Chat –How Can You Effectively Apply AI and ML to Your Enterprise Data to Support Your Ever Evolving Risk Management Strategies?
Nicolette Bullivant, Head of Data Engineering, Santander
Shane Lamont, Head of Data and Architecture Office, HSBC
