On September 17, 2014, Aite Group's David O'Connell was involved in a Q&A Twitterview with Delphix, where he discussed data virtualization for banks and the subject of stress testing. If you didn't get a chance to see it live, you can read the transcript below or search Twitter for #BankStressTesting. And for more information on the subject, you can sign up for the Thursday, September 25 webinar on the subject here.
Last week, IBM announced its entrance to the fraud arena with IBM Counter Fraud Management. In a way, IBM isn't new to the booming fraud space. Relatively mature acquisitions such as SPSS have long had fraud-specific configurations and frameworks. And Global Business Services (GBS) has been delivering fraud-mitigation deployments by combining a variety of fraud-related analytics tools such as reporting and case management.
First, in the interest of full disclosure, I should make it clear that I’m a fan of stress tests. Stress tests, such as capital adequacy testing and the Dodd-Frank Act Stress Test (DFAST), simply enable Basel governments—like the U.S. Federal Reserve—to treat the banks that they regulate as borrowers whenever a speculative bubble bursts, which now appears to be every 12 years or so. In fact, the stress-test process looks a lot like the due diligence that banks themselves perform on their own borrowers, including pro forma financial analyses based on dire economic projection scenarios.
A few days ago, Banorte, Mexico’s largest bank, entered into a 10-year strategic agreement with IBM. The relationship is no small change for Banorte, which acquired a de-facto partner in IBM; IBM will benefit from gain-sharing agreements over length of the partnership as the bank improves its operational outcomes with US$1 billion in IBM capabilities and services. Analytics will be a primary focus of the relationship, with the goal being analyses and decisions at the individual customer level rather than the customer segment level.
David O’Connell is a senior analyst with Aite Group’s Wholesale Banking team, where his primary coverage area is lending. A former commercial lender of 14 years, Mr. O’Connell brings to his lending coverage extensive hands-on and granular knowledge of banks’ challenges in building businesses that lend safely, cost-effectively, and at scale. Broadly scoped, Mr.