Requirements for Systemic Risk Management in the Financial Sector

This chapter discusses the information technology requirements of systemic risk management, from the point of view of a hypothetical regulator of an "originate-to-distribute" (O-D) financial supply chain. We take the view that, even though the mortgage sector remains seriously disabled following the World Financial Crisis of 2008, the information technology requirements for the collection and transmission of data, as well as the performance of various analytical operations, at each step of the O-D process are in fact generic to the development of scale efficiencies in funding consumer and small commercial loans. This paper identifies requirements for the construction and use of scalable, data and compute intensive analytical solutions capable of meeting the challenge of decision support for institutions concerned with broad scope risk. Such considerations apply not just in the financial system, of course. But our discussion is particularly motivated by requirements for public regulators, financial services entities and other business entities with significant liquidity and financial management needs.

By: Donna N. Dillenberger, Alan J. King, Aviv Orani, Francis N. Parr, Gong Su

Published in: RC25282 in 2012


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