Liberating bank capital

The problem

Our client, a top 20 global bank, engaged us to find opportunities to free up capital by analyzing the flow of data into its enterprise risk engine.

Data flows were extremely complex: originating in over 60 source systems, data moved through thousands of transformations before being converted into risk weighted exposure and capital amounts. With a balance sheet of hundreds of billions of dollars, any errors or omissions in the underlying data and calculations could cost tens of hundreds of millions of dollars.

Our client had a tight time frame and needed to complete the work within three months.

The most efficient path

We used a proprietary methodology to identify opportunities, and focused on what matters.

  • Our methodology enabled us to integrate both data flows and financial flows into a single framework. This approach allowed us to combine business and technology perspectives, and identify not only what cost savings could be achieved, but also where the opportunities were located.
  • We were ruthlessly efficient in discarding information that was not relevant. We were inundated with large volumes of disparate data, and we quickly focused on only the information that contributed to solving the specific problems at hand.

The most enduring value

Our client was presented with opportunities for potential immediate cost savings of tens of millions of dollars. We achieved this by pinpointing many different types of data issues – data gaps, double counting, invalid transformation rules – that impact and have distorted the bank’s capital calculation process.

In addition, our client will use the data lineage – a clear, accessible blueprint of their critical data and capital flows from source to output – to underpin their transformation efforts, and to address structural vulnerabilities during their this process.