KPMG fears harm to recovery as regulators drag out bank reform
THE WAVE of red tape hitting banks is so variable, unpredictable and poorly planned that lenders cannot respond effectively, a KPMG report warns today.
World leaders had hoped to co-ordinate regulation after the financial crisis to put the whole banking industry around the world on an even footing.
But KPMG is concerned each county is coming up with individual plans and priorities, as well as changing proposals years in the planning.
“The ongoing uncertainty is the killer, making effective planning almost impossible. As unanswered questions keep surfacing, it is clear that we are a long way from resolving the complexity of the big cross-border banks,” said KPMG’s Giles Williams.
“The length of time it takes to finalise initiatives is also letting us down. If the recently released structural reforms from the European Commission are implemented as planned in 2017 and 2018, almost a decade will have passed since the height of the financial crisis.”
Incoming regulations include the bonus cap, which has pushed banks to come up with more creative ways to pay their best staff.
The mooted financial transactions tax could also have a major impact on banks, other finance firms and investors across much of the EU.
Beyond those more high-profile changes, the consultants also expect serious back-office and infrastructure changes.
“Banks face three major challenges around data management,” said Williams. “They need to hold and use the right data to get closer to their customers, they face increased demands for reporting and disclosure, and they face concerns about inadequate IT systems to help them manage risk effectively.”