According to research by Deloitte, the top 100 financial institutions will spend over $100 billion a year implementing risk governance frameworks by 2012. The money will be spent on people, computer systems and meeting Basel II and Solvency II capital standards.
The top 100 financial institutions will spend over $100 billion a year implementing risk governance frameworks by 2012, according to research from business advisory firm Deloitte.
This is more than double the figure they spent on risk and control activities in 2006, the last full year before the financial crisis, says Deloitte, which surveyed chief risk officers (CROs) or equivalents at 28 financial institutions, including investment and retail banks and insurers.
Most respondents expect spending on risk and compliance to continue to rise and say much of it is a direct result of the global financial crisis. Money is being spent on people, computer systems and meeting Basel II and Solvency II capital standards.
However, despite the growing financial investment in risk governance, Deloitte believes the success of such expenditure hinges on a corresponding behavioural change in risk culture.
While 93 per cent of the CROs surveyed say their firms have comprehensive enterprise-wide risk statements in place, only 67 per cent suggest these are having a significant impact on risk-taking behaviour.
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