The Basel II Capital Accord will have a more profound effect on how information technology is delivered across the financial services industry than any previous event in these sectors, according to a new report from the Yankee Group.
Andy Efstathiou, programme manager for The Yankee Group's technology management strategies practice, says the Basel II Accord will change the financial services industry worldwide over the next five to ten years.
He states: "Our research indicates Basel II will aggressively increase the amount of outsourcing in the financial services industry, and drive upgrades to reporting and monitoring tools for the financial industry."
While the provisions of the accord are not yet finalised, the core framework is clear, adds Efstathiou.
"Financial services firms that successfully change their IT infrastructure in compliance with Basel II dictates will gain significant competitive advantage by reducing their regulatory capital requirements, effectively increasing their capital."