Over half of financial institutions think they would have been better prepared for the credit crisis had they been able to monitor their exposures and concentration levels in real-time, and many are now belatedly investing in technology to help them do this, according to a survey from Aleri.
The poll of over 250 asset managers, hedge funds, banks and brokerages reveals that 70% of respondents think their firm has a need to manage risk in real-time. Yet just 26.4% of hedge funds and 50% of banks feel they have the appropriate technology to do this.
In addition, the crisis has contributed to 20% of banks and 26.7% of hedge funds cutting back on information technology spending.
However, 55% of respondents say their firms took initiatives immediately following the financial crisis and are now poised to invest in real-time risk management technology.
Don DeLoach, CEO, Aleri, says: "The results are a strong indication of the industry's views on the importance of investing in technology that can deliver critical intelligence as it unfolds. The market today is moving so quickly; real-time technology is the only way to adequately manage risk in the face of unexpected market events."
A recent survey by the Economist Intelligence Unit found that just a third of financial services executives think risk management principles in their business remain sound, with over half conducting or planning a major overhaul of operations.
Meanwhile, a study from Ernst & Young published in December found that, of 48 senior executives from 36 major banks around the world questioned, just 14% have a consolidated view of risk across their organisation.