Risk managers and compliance officers from banks and other financial services institutions in Hong Kong and Singapore have pointed to a number of regulatory concerns as being key challenges in 2013.
The Bloomberg survey of 130 risk managers and compliance officers found more than 50 per cent of respondents in Hong Kong and Singapore view implementation of new regulations as the main challenge in the regulatory space over the next 12 months, more so than costs or compliance timelines.
Sixty per cent of respondents in Hong Kong and Singapore view the clearing of over-the-counter (OTC) derivatives as very critical or important; and 46 per cent of respondents in Hong Kong view compliance and audit trail as important.
Three in five respondents in Hong Kong and Singapore said that they will be investing more in better analytics and risk modelling over the next year, and taking other steps including investments in risk systems and better cross functional communication.
Half of Hong Kong respondents and one quarter of Singapore respondents did not think regulators had provided sufficient information to prepare for the implementation of new OTC derivatives regulation.
More than 70 per cent of respondents did not think users will stop trading derivatives if proposed margin requirements on uncleared trades come into force, but the same proportion expected derivatives trading to make less money this year with the onset of new regulations in 2013.
Respondents also expect to spend 20 to 40 per cent more on reporting and technology/infrastructure to comply with new regulations over the next 12 months.
