International provider of integrated risk and finance solutions, Financial Architects (FinArch), delivers Liquidity Risk Calculation and Reporting solution to HSBC Europe to meet the UK FSA Liquidity Risk Reporting requirements.
After a thorough examination of the available technologies, HSBC has selected Financial Studio from FinArch to deliver systems support for Liquidity Risk Calculation and Reporting.
The solution provides HSBC with a common data architecture in which to store, manage and enrich data from all parts of the business. Data is enriched through a sequence of calculators, addressing valuations and cash flows, Liquidity Risk, Gap Analysis, Concentration Risk and Ratio Monitoring. FinArch’s Simulation Engine caters for the stresses prescribed by the UK FSA as HSBC can stress their Liquidity Risk measures across multiple scenarios, such as Rollover, Balance Sheet Growth, Default, Prepayment, Devolvement, Maturity, Haircuts and Interest Rates.
HSBC has also put in place a pan-European Liquidity Risk measurement reporting solution using Financial Studio, the benefits of which go far beyond regulatory compliance.
"We found Financial Studio from Financial Architects to be the most comprehensive solution in the market for the measurement and reporting of Liquidity Risk." Says Mike Doherty, Head of Asset and Liability Management, HSBC EU. "The solution meets our needs now and is extendible to other domains of liquidity risk management and reporting in other jurisdictions, not only the UK." He continues: "We have been impressed by the subject matter expertise offered by FinArch and the dedication, professionalism and commitment of their Professional Services team. The project has been a great success, we delivered on time and FinArch were attentive in meeting all of our needs."
"FinArch is delighted to welcome HSBC to the FinArch family. It is of course very reassuring that such an organization shares a strong belief in our products and people." Remarks Nigel Lee, Chief Commercial Officer at FinArch. "Financial Studio has rapidly established itself as a leader in the integration of risk and finance solutions space. The UK FSA Liquidity Risk Reporting regime is a clear step towards regulatory integration of risk and finance." Continues Lee. "Working together with HSBC has been a rewarding process and also a confirmation that FinArch’s thinking is absolutely in the right direction. The success of the project is testament to the quality of FinArch’s people and the superiority of our software as a result and to the vision and talent of the HSBC organization", concludes Lee.
Financial Studio is a comprehensive integrated Risk and Finance solution based on a single version of the truth in data terms, i.e. a common core Financial Data Architecture. Based on the Finance Resource Planning (FRP) concept, the solution provides complete functionality for the management of the entire accounting chain, enterprise risk management function and internal and external reporting obligations.
Financial Studio’s Risk Return Framework covers the measurement and management of all risk types. Not only Liquidity Risk as mentioned above, but also Credit Risk, Market Risk, Operational Risk, all of which are available to FinArch’s customers even if in the beginning the solution is being implemented for more specific purposes. The Simulation Engine and Analysis Engine work in parallel with all risk types, not just liquidity. In addition the framework provides comprehensive functionality for Risk Adjusted Performance measurement and Economical Capital, including aggregation and allocation.
