business. When a digital strategy is developed and executed in line with the .... AQMetrics provides integrated complian
RegTech Solutions for the Fund Industry
RegTech Solutions for the Fund Industry REGTECH REPRESENTS A REAL OPPORTUNITY FOR LUXEMBOURG TO PLAY THE LEADING ROLE IN THE FUTURE OF THE FUND INDUSTRY Wednesday, June 28, FinnoLux hosted an event focused on ‘RegTech Solutions for the Fund Industry’ a collaboration with Enterprise Ireland, and the International RegTech Association. The purpose of the event was to the opportunity RegTech brings to the fund industry. As ‘digital enablers’, at FinnoLux we work, on a daily basis, with clients in the financial sector, defining with them their digital strategy, executing the delivery roadmap, to enable them to take full advantage of the opportunities available.
OPPORTUNITY FOR LUXEMBOURG Dr. Subas Roy, global chair of International RegTech Association (IRTA), former Global RegTech Lead at Ernst & Young and reputed as being one of the ‘famous five of
RegTech’, while presenting in Luxembourg
We believe the use of technology, especially RegTech, has an exceptionally positive impact on the organisation and the industry, when those technologies are applied which strengthen instead the business. When a digital strategy is developed and executed in line with the overall business strategy. For those who are not aware, RegTech is the application of technology to solve challenges relating to regulation, compliance and supervision. RegTech, has however, a value beyond the area of compliance. This is driven by the value proposition of RegTech itself which is not one of disruption but is one of strengthening. One of the key take-away messages from the event is that RegTech will play an important role in the defining of the future of the Fund Industry in Luxembourg. It became evident that the future of the industry depends upon the industry’s ability to redefine themselves by applying RegTech. Regulatory Technology is the application of technology to facilitate compliancy with regulations. While one of the values what RegTech brings is to simplify and improve compliance, the wider benefit is far larger and acts as a stimulus to bring automation to the processes.
this week, explained the RegTech industry is rapidly growing, with an estimated size
REGTECH’S VALUE PROPOSITION
of $20bn by 2020. ‘That is a huge oppor-
In our daily interactions with the Fund sector and more generally with the financial industry, we understand that the ever-increasing regulatory burden and complexity, make it harder to manage costs and human errors are more likely to occur. Margins are under pressure due to competition from new market entrants, especially those in Asia. RegTech allows the companies to avoid spending millions on compliance projects and instead to shift their focus to products and services which can truly differentiate them. By introducing RegTech, companies free-up time and resources to enhance regulation and compliance while strengthening the industry and protecting customers.
tunity, at a global scale, for Luxembourg too, to be the leading pioneer of RegTech in the Assets Management and Fund sector, to help create a global centre of excellence, an
innovation zone that can help further foster its current 4% economic growth for the years to come!’
FinnoLux. Digital. Enablers.
By freeing up both people and money, the companies can focus on developing the financial industry of the future. The annual spend of firms in the financial sector on regulatory compliance ranges between 10% and 15% of their annual revenues, with much of the work performed manually: Imagine if a large portion of this could be spend on the business itself.
RegTech Solutions for the Fund Industry THE OPPORTUNITY FOR THE LUXEMBOURG FUND INDUSTRY RegTech is here to strengthen the Fund Industry and to protect the end customer… this was one of the key findings during the event called ‘RegTech Solutions for the Fund Industry’. It also became clear that the opportunity RegTech provides for Luxembourg is much bigger than FinTech as it brings real relevance and real opportunities to strengthen the existing industry.
OPPORTUNITY FOR LUXEMBOURG Matt Elton, CEO of Luxembourg-based FinnoLux, and Vice-chair and co-founder of the IRTA elaborates, ‘The groundwork which has been laid by Luxembourg’s lead-
ing academic institutions and, in particular, SnT’s cutting-edge research in machine learning, artificial intelligence, machine readable regulation, reinforces Luxembourg’s position, as these technologies are directly applicable to RegTech. It is through the highly collaborative model developed between
academia and the private sector that gives Luxembourg this wonderful opportunity to remain in the lead. By using the talent and capability which we have and applying it to our own industry, we can enable Luxembourg to strengthen its position as a leading financial centre, whilst at the same time becoming one of the world’s leading RegTech hubs’.
FinnoLux. Digital. Enablers.
In his opening speech, the Irish Ambassador to Luxembourg H.E. Peadar Carpenter, stressed the need for people to adapt, and find systems to comply. Keynote speaker, Dr Subas Roy, Global Chair of IRTA emphasized ‘RegTech is the Innovation-in Trust as its very purpose is to enable sustainable, purposeful businesses. Enabling the financial services to become future-resilient as their future is heavily dependent on its ability to become more trusted, more customer focused and more demand-led’. In this sense, RegTech enables the Luxembourgish Fund Industry to redefine itself and shape its own powerful future. At the event six Irish companies, FundRecs, FundCalcs, RiskSystem, Corlytics, AQ Metrics and Gecko Governance presented their highly innovative RegTech solutions. These solutions ranged from cloud based regulatory risk reporting and automation to blockchain proven compliancy as well as AI fed text analytics, all being perfect matches to the Luxembourg Fund Industry. Bert Boerman, CEO of Luxembourg-based Governance.io emphasized during the round table discussion the existing relations and compatibility between the Irish and Luxembourgish RegTech companies. Laurent Marochini, Chair of the ALFI working group on Blockchain and Cryptocurrencies, confirms the openness of the industry to collaboration by stating ‘we are competing for end customers but not in terms of technology or being compliant. We should find niches and ways to work together between Ireland and Luxembourg’. Matt Elton, Vice Chair IRTA, adds ‘RegTech’s value proposition has real relevance to Luxembourg; RegTech taps into the talent and capability the academic institutions here, such as LIST and SnT, have built in the past years, while at the same time it strengthens the position of our Fund Industry’. The round-table discussion between Bert Boerman, Laurent Marochini, Matt Elton and Alan Ridgeway, Irish independent director living 23 years in Luxembourg, concluded that the shared challenges both Fund Centres face, increase the need for a common voice of the Industry.
FUNDCALCS
FundCalcs pioneers unprecedented levels of transparency in the Alternative Investment Management industry. No longer do Fund Adminstration and Investment Management functions need to be seen as “black-box” activities, relying on rigid reports to provide occasional snapshots of their workings. www.fundcalcs.com
RISKSYSTEM Risk Management is an increasingly onerous problem for fund managers needing to conform with UCITS and AIFMD regulatory obligations. Integrating risk analysts, data analysts and proprietary analytics, RiskSystem provides fund managers with a comprehensive and cost effective solution for all their risk management requirements. www.risksystem.com
GECKO GOVERNANCE
GECKO Governance is a new RegTech fund management regulatory solution that allows users to schedule, manage and monitor a large portfolio of investment fund’s regulatory & compliance requirements in real-time. GECKO Governance gives users the “Big Picture” by providing them with a live Birds Eye view across all their funds compliance requirements from one central dashboard. www.geckogovernance.com
FUNDRECS FundRecs is a reconciliation platform for the Fund Industry. Velocity is a platform which FundRecs recently launched, empowering administrators to process valuations faster and with increased oversight. The platform consists of four modules: Cash Reconciliation, Trade Capture, Position Reconciliation and FX Reconciliation and has some interesting features like the lack of installation fees, the customizability and the fast golive time. www.fundrecs.com
CORLYTICS Corlytics is the world leader in regulatory risk intelligence. Positive regulatory outcomes are of enormous benefit to regulators, regulated firms and their clients. Corlytics uniquely analyses enforcement data and other important regulatory information. This helps all stakeholders achieve better regulatory planning and execution, by providing evidence based intelligence. We do this by providing a unique multidisciplinary team of legal analysts, risk professionals and data scientists. Our intelligence is used by regulators, financial institutions and their advisors on a global basis. www.corlytics.com
AQMETRICS
AQMetrics provides integrated compliance and risk management software to fund administrators, asset managers, investment managers and broker/dealer companies. Our consolidated platform delivers data management, risk profiling and monitoring, compliance workflows and reports all in one place. www.aqmetrics.com
FinnoLux. Digital. Enablers.
ABOUT FINNOLUX FinnoLux is focussed on the creation and execution of digital strategy in the financial sector, of which automation of midand back-office are key parts. By understanding of the needs of regulated industries, as well as the solutions and value brought by RegTech solutions, we enable organisations to transform their regulatory burden into new revenue streams – unlocking the value of data. As a digital enabler, we make digital ‘happen’ for our customers, assisting them in reinvigorating their business and enabling them to reduce costs and inefficiencies and instead focussing on the true differentiators. Our deep understanding of the industry value-chain as well as our true business experience puts us in the perfect position to align your digital strategy with your future perspectives.
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