Risk-based pricing after IFRS9


When IFRS9 came into force in January 2018, many in the credit risk world thought the hard part was over. After all, conventional wisdom suggested the new standard would cause a one-off shift in expected loss provisioning and life would return to normal.

However, as firms are now rapidly gaining experience with the first generation of models, a number of practical implications have sprung up with far reaching consequences on business models beyond the challenge of accounting for potential credit losses. One such challenge is the adequate pricing of the implied economic costs of credit under the new standard.

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Posted on 23/05/2018 | 0 Comments

Does good corporate governance lead to better performance?

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There are various elements of corporate governance that interact with each other and influence the organization’s performance. Our research1 indicates that the most effective elements of ‘good’ governance are independence and diversity of the Board of Directors, remuneration of senior executives, characteristics of the CEO, and the organization’s oversight and ownership structure. Here are six relevant drivers of corporate governance that should be essential to any Financial Services Firm.

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Posted on 8/05/2018 | 0 Comments

Treasury maturity – three years with negative interest rates

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After three years of negative interest rates, three out of four Swiss banks manage only to a limited extent the interest rate risks in their balance sheet.

A Treasury pulse check by Deloitte Switzerland has revealed that only a few banks factor interest rate risk in by adjusting short-term tenors or variable interest rate products in their lending business or by offering off-balance sheet products to offset the impact of low or negative margins on their deposit business.

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Posted on 2/05/2018 | 0 Comments

MiFID II – Day 2: What banks have to keep in mind

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While banks have deployed compliant MiFID II solutions, there are several cases where the implementations remain reliant on manual processes, in particular where requirements or interpretations changed at a late stage.

In this blog, we take a look at the road ahead and how a future-proof solution can be accomplished as part of the Day 2 activities. Focusing on the strategic optimization of the operating model and considering new technologies such as Process Mining, Robotic Process Automation (RPA), Big Data and Blockchain is crucial to gain efficiency while remaining fully MiFID II compliant.

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Posted on 25/04/2018 | 0 Comments

Will automated decision-making turn banking upside down?


Only a few years ago, human beings were needed to understand text and recognise images. It is now becoming increasingly possible to automate these functions using cognitive technologies, such as machine learning. In fact, one of the first practical deployments of machine learning, the automated processing of handwritten cheques, began in banking in the early 1990s.

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Posted on 19/04/2018 | 0 Comments

PSD2 finalised standard on SCA and CSC: the wait is over, but questions remain

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Twenty months after the European Banking Authority (EBA) issued the first draft, on 13 March the regulatory technical standard (RTS) on strong customer authentication (SCA) and Common Secure Communication (CSC) under revised Payment Services Directive (PSD2) was finally published in the Official Journal of the European Union.

The length of the process and the number of iterations required to finalise the standard evidence the complexity of developing rules to establish a level playing field between different market participants, while at the same time ensuring technological neutrality, consumer protection, and enhanced security in payments services.

The finalisation of the RTS is an important milestone which will give firms much more clarity and certainty on how to push forward their PSD2 compliance and strategic programmes. Nevertheless, the final RTS still leaves a number of important questions open, particularly in relation to the development and testing of access interfaces for Third Party Providers (TPPs).

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Posted on 12/04/2018 | 0 Comments

An outsider’s view: Seven essential questions bankers should ask themselves in the digital age

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Digital innovation has had a smaller impact on banking than in other industries – at least up to now. Companies in other industries have been much more alert in responding to the innovative disruption from digitisation, if not driving it themselves.

Banks can learn a thing or two from their industry peers. Coming from the financial sector myself, but now as a banking «outsider», I reflect on seven essential questions that are relevant for every banker.

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Posted on 10/04/2018 | 0 Comments

Fintech – An Opportunity for the Financial Sector


Deloitte’s financial services practice is the largest professional services organization in the world. This offers me the daily opportunity to work with clients and address their heart of business issues. It means that I see global, regional, and national financial services organizations in action. I see how they face the current market and how they plan for the future offered by the disruptions taking place.  

We are in the early stages of a technology driven transformation of the financial services industry globally.

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Posted on 6/04/2018 | 0 Comments

Development of Managed Services using the example of LEI

Banks and their clients have to comply with new MiFID II/MiFIR rules and obtain unique Legal Entity Identifiers (LEI) since January 2018. Otherwise, banks are no longer allowed to execute trades on behalf of their clients. Deloitte Managed Services demonstrates how managed service providers should adapt and extend their offering in compliance with new regulatory demands on their clients. The new LEI portal helps banks and legal entities to understand the new regulations and to get compliant with the new MiFID II/MiFIR – LEI requirements.

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Posted on 3/04/2018 | 0 Comments

FATCA and QI certifications: the good, the bad and the ugly

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Industry asked for more time to make the FATCA and QI Responsible Officer (RO) certifications and it appears as though the IRS have listened, but at what cost? While some of the major issues have been addressed, it becomes more and more apparent that the FATCA and QI RO certifications will be onerous and will require significant attention from the ROs and their teams.

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Posted on 29/03/2018 | 0 Comments