Earlier this month, Nasdaq launched its new data discovery capability for trade surveillance, principally to enable financial firms to more readily respond to regulatory requirements.
Nasdaq’s new capability joins solutions like the Real Price Observations Data Service from DTCC in addressing data management obligations arising from the Fundamental Review of the Trading Book (FRTB).
“How data is unlocked and utilised [as] a key source of decision making is crucially important,” stated Valerie Bannert-Thurner, Senior Vice President and Head of Buy-Side and Sell-Side Market Technology Solutions for Nasdaq. “We believe our new capability [enables] trade surveillance clients to enhance their operations and empower their business strategy.
Announcements from market infrastructure players like these are timely; as whilst some two-thirds of firms indicate FRTB implementation challenges, consensus is building that the deadline may well ease into 2023.
Firms continue to explore how to unlock their data against a raft of regulatory reforms; not least the proposals outlined in Transforming Data Collection from the UK Financial Sector.
The paper, published by the Financial Conduct Authority and the Bank of England, is the subject of ongoing industry engagement until 7th April. On 29th January, the Bank reiterated its intent to phase in these reforms, with a view to enabling near real-time compliance data collection.
Ultimately, as regulations like these drive firms to upstream trading data into risk engines, the need for quality leaders to curate a golden source of adequately processed pre-production data is vital.
“Historically, data management difficulties arose through a lack of standardized models,” according to a senior risk executive for a tier 1 bank. “Rendering suitable data to the risk engine in low latency environments is a critical challenge to overcome.”
So, whilst regulators outline the next phase of data transformation reforms, financial firms are investing in end-to-end workflow calibration between the trading desk and risk engine.
To prepare for the FRTB implementation deadline, firms can baseline their current data management strategy against the findings uncovered in 2018 by QA Vector® Research in Unlocking Data for the Enterprise – Making Data a Strength, published in partnership with Delphix.
