Following the financial crisis, stress testing has become a central means of determining capital need for banks and the approach is here to stay. The industry’s response to this new paradigm has been a frantic development of capabilities, focused primarily on the methodological techniques that underpin robust financial projections.
As highlighted in Oliver Wyman’s ‘Stress relief: Are vended systems the answer?’, stress testing will only increase in complexity and many banks are considering implementing stress testing systems. In light of this, the vended system market has been developing quickly and there are now a host of system solutions available to banks. Whilst there is a valuable role for systems, their integration into the stress testing process will be a long term effort involving multiple staged implementation processes.
This report delves further into what stress testing systems can deliver, and looks at the standard vended system capabilities against five process steps required to complete a stress test. In developing the report, Oliver Wyman met with nine major providers of stress testing solutions: seven enterprise stress testing system vendors and two vendors which have more specialised offerings.
The study highlights Oracle Financial Services Enterprise Stress Testing solution that includes Oracle Financial Services Enterprise Modeling, Oracle Financial Services Enterprise Stress Testing and Capital Planning Analytics, Oracle Financial Services Data Foundation, Oracle Financial Services Liquidity Risk Management, Oracle Financial Services Basel Regulatory Capital, and Oracle Financial Services Analytical Applications Infrastructure.
Oracle was one of the nine vendors featured in the report. Oracle provides an enterprise stress testing solution that gives banks a single environment from which to manage all aspects of stress testing.
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In addition to Oliver Wyman’s ‘Stress relief: Are vended systems the answer?’ report, a separate detailed document provides an overview of the vended stress testing systems that are available to banks. This can be requested via www.oliverwyman.com/stress-testing.html.
Ambreesh Khanna is the Vice President of Oracle Financial Services Analytical Applications. He can be reached at ambreesh.khanna AT oracle.com.