Financial institutions are under constant pressure to reduce costs, improve operational efficiency, adapt to regulatory changes and grow their business. NRI believes that a combination financial knowledge and information technology are crucial to the industry’s growth and development. Through our lakyara reports, NRI identifies the various capital markets and IT issues impacting our clients and the future of their business.
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The Fed published information about programs to combat the crisis. The data indicate that the PDCF (Primary Dealer Credit Facility), under which the Fed loaned money against securitized assets, helped prevent a fire sale of assets, and the TAF, which originally was used by the largest financial institutions, increasingly came to support regional banks. They suggest as well that collateral-based LOLR (Lender of Last Resort) facilities like the TSLF (Term Securities Lending Facility) have become a part of central banks' toolkit. The Fed also created a framework for dollar operations by the world's central banks' toolkit. The Fed also created a framework for dollar operations by the world's central banks by extending swap lines. However, the frequent use of TAF (Term Auction Facility) and others by non-US financial institutions raises the question of how home- and host-country central banks should share responsibility for supplying liquidity during a crisis.
With asset management companies' middle-office operations converging internationally and across different types of accounts, BPO (business process outsourcing) services' scope is expanding from back office to middle office. BPO's emergence as an option to improve competitiveness and operating efficiency enhances the Japanese BPO market's growth prospects.
Chinese Capital Markets
China's securities industry landscape is expected to change dramatically over the next several years. Until a new order led by several internationally competitive securities firms emerges, China will delay opening its securities sector to foreign competition. The course of Chinese securities industry consolidation therefore bears close watching.
IT & Operation
XBRL holds promise as a means of rapidly disseminating large amounts of information contained in securities filings and analyzing increasingly diverse corporate operations from various angles. Initiatives to improve accuracy are needed for XBRL to effectively fulfill these functions.