A Leading Global Bank seeks startups for Controls Automation

This initiative is led and supported by the Chief Controls Officer(CCO) and any good solutions will be piloted in the US and led by the CCO.  This is a high priority for the C-Suite so for creative solutions the action will be very timely.

As part of this Global Bank’s strategy to be the leading international bank in the US, they are looking to MIT to help drive its digital journey for Risk & Controls framework, both at pace and at scale, with automated end-to-end processes and underlying key controls, positioning the bank as an industry leader in this space.

Problem Statement: Their current framework for managing Non-Financial Risk such as Information Technology Risk, Financial Reporting Risk, Regulatory Compliance Risk, and Model Risk, which is heavily dependent on manual controls thereby increasing its overall cost to effectively manage and maintain controls environment. Our goal is to move from currently 10% automated controls to 80% automated controls by 2024 (or sooner)

Some of the contributing factors and challenges are:

• Infrastructure limitations i.e. processes and data is spread across various legacy systems which is limiting bank capabilities to automate and rationalize controls environment.
• Requirements to comply with regulations and governing principles are increasing both the volume of controls and documentation required around these processes and controls. Also, it is making read-across even more challenging, causing overlapping and redundant controls spread across Lines of Business and Functions.
• Evolving risk and regulatory landscape is further extracting resources as they are increasingly focused on remediation and/or establishing new processes/controls to ensure compliance with these requirements. Time and resource constraints associated with these deliverables are also limiting capabilities for deploying scalable solution. The burden of managing, testing and reporting is also increasing, which is growing inefficiencies across 3LOD i.e. first line (Risk and control owners), second line (assurance) and third line (audit) are putting significant manual effort to maintain (include control owner continuous monitoring activities) and test on the efficacy of the controls environment.

The benefits of digitization are far more than what can be covered here but listed below are some of the key benefits/ immediate returns:

• Better and faster customer service with minimal breakdown by reducing number of manual steps and probability of human error.
• Enhanced and pro-active Risk management, with increased focus on emerging trends and underlying themes rather relying on manual and detective controls operating at a pre-defined frequency.
• Increased efficiency of operations and reduced costs of evidencing controls effectiveness.