19 October 2017
Find out more

Web search data and computer-based finance focus for EC-backed systemic risk study

18 October 2010  |  6697 views  |  0 EU flag

In the wake of the global economic crisis, the European Commission is funding new research into systemic financial market risks, exploring how complex, highly inter-connected digital information and transaction systems leave institutions exposed.

The EC argues that one reason the severity of the recent financial crisis was not adequately predicted was because existing tools and data did not allow experts to sufficiently consider the extent to which the sector relies on complex computer-based interactions and mutual exposures.

It's now backing a three year project that sees researchers from universities in Italy, Spain, Switzerland and the UK, as well as experts at Yahoo! and the European Central Bank, analyse the complex system of global, ICT-based financial transactions, along with Internet search queries, to monitor the build-up of risk in the financial system and the economy as a whole.

The aim of the "Forecasting Financial Crises" project is to improve policy makers' understanding of how banking systems, stock markets and the flow of credit are mutually interconnected.

The group hopes that conceptual and software instruments developed during the research could help develop early-warning systems that would permit actions to be taken if needed to stabilise financial markets.

The research will focus not only on financial transaction data, but also on Internet search data such as the frequency of certain key words related to finance in search engines.

Ultimately, the aim is to develop new risk indicators that could be used by policy bodies like the European Central Bank, the European Systemic Risk Board, or the Basel Committee on Banking Supervision to help to prevent future financial crises.

The project - Web site here - began in September and will run until 2013 at a cost of EUR2.48 million, of which the EC is providing EUR1.8 million.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Financial crisis spurs complex data analytics uptake - survey

Financial crisis spurs complex data analytics uptake - survey

03 June 2010  |  9408 views  |  0 comments
Risk management weaknesses at finance firms persist - EIU survey

Risk management weaknesses at finance firms persist - EIU survey

04 May 2010  |  12000 views  |  1 comments
Credit crisis spurs real-time risk management IT spending - survey

Credit crisis spurs real-time risk management IT spending - survey

14 July 2009  |  8866 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.fivedegrees.nlvisit www.innotribe.com

Top topics

Most viewed Most shared
Ripple looks to drive bank adoption with $300m XRP rebate programmeRipple looks to drive bank adoption with $...
15541 views comments | 12 tweets | 4 linkedin
Swift positive on blockchain, but big challenges remainSwift positive on blockchain, but big chal...
8729 views comments | 16 tweets | 22 linkedin
hands typing furiouslyHow artificial intelligence can deliver a...
8374 views 0 | 8 tweets | 9 linkedin
satelliteGates Foundation backs Ripple collaboratio...
7821 views comments | 13 tweets | 10 linkedin
IBM uses blockchain to improve cross-border payments processingIBM uses blockchain to improve cross-borde...
6976 views comments | 9 tweets | 17 linkedin

Featured job

Find your next job