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MDM for Financial Risk Management

A leading bank unifies its credit reference data in order to reduce risk exposure and enforce Basel II compliance

Context

In 2006, this bank launched a global initiative for credit risk management and regulatory compliance. In a Basel II compliance context, the main objective of the project was to provide unified and consistent credit reference data used across the bank for credit risk evaluation, by the end of 2007.

The main challenge was to consolidate and then manage securely more than 150 data objects and around 1 million records that was dispersed in multiple systems, including databases, ERP or spreadsheets. Risk managers had to take ownership and management of Master Data and be able to track changes between versions.

Data Governance Objectives

• Build a central credit risk reference data repository
• Enforce rights and security rules for risk managers across the bank
• Define complex data validation rules and integrity controls
• Provide an highly detailed audit trail for SOX compliance
• Maintain multiple versions of credit risk data
• Empower risk managers with a user-friendly data management tool

Solution: EBX.Platform

In order to meet the short deadline, the bank selected EBX.Platform against a custom development. EBX.Platform provided out-of-the-box Data Governance features that allowed to build a secure and operational MDM:

• Role-based security and end-user workflow
• Master Data validation rules
• Audit trail and version control
• User-friendly GUI for risk managers and end users
• Ability to expose Data as Services, in order to propagate changes to multiple systems

Benefits

• Meet the regulation deadline by developing a first prototype in 2 weeks and then deploying an operational credit risk MDM in less than 5 months
• Improved user involvement by providing a user-friendly, workflow-oriented tool
• Avoid credit risk inconsistencies by defining complex validation controls and enforcing rights and security rules