The financial
sector spends huge sums on IT. According to a report from research
firm Financial Insights, global technology spending by capital
markets firms alone will reach $95.5 billion this year.
Increasingly, firms in the sector use their IT infrastructure as a
core part of their services, integrating home banking, ATMs and
trading systems into their products.
This is happening at the same time as a flurry of mergers and
acquisitions, involving disparate sets of IT systems. According to
a white paper on financial services IT from CA, "Some of the larger
financial services industry players are still trying to get their
arms around platform consolidation."
IT governance is one of CA's proposed solutions to IT problems
in financial services. This is a process which attempts to
integrate IT functions more closely with business functions. "The
bridge that connects business and IT is the process of IT
governance, which allows organisations to make fact based decisions
in order to maximise the return on IT investments," said the white
paper.
The Sarbanes-Oxley Act, a US law which can also apply to
companies outside the US, has introduced a higher standard for
corporate governance and accountability in IT. It introduced
frequent auditing and reporting requirements and controls and data
retention rules that impact on IT systems. As a result, IT
directors carry a heavier burden: boardrooms expect them to take
responsibility for the security, accuracy and reliability of the
systems that manage and report their companies' financial data.
The other crucial element in CA's view of financial services IT
is timeliness. The company offers a series of products aimed at
increasing the amount of information sent to these businesses in
real time.
"The value of static information is steadily diminishing," said
the white paper. "When institutions are called on to make
statements establishing their compliance with regulatory mandates,
for example, they need to do so with complete confidence in the
accuracy of the data they provide, and that demands real time
information."
The firm believes that this kind of IT infrastructure can make
the difference between success and failure in the competitive world
of financial services. "In today's make or break financial services
world," it said, "the spoils of victory go to those firms that have
managed to tame their unruly IT systems through a coordinated
approach to IT management and governance."
