Today, George Osborne is expected to announce plans to implement major reforms as proposed by Lord Tyrie’s cross-party banking commission. These will involve better governance, stronger and better informed boards and tighter controls on risk. These proposals echo many of the concerns of the banking regulators who are demanding higher capital ratios (see HotViews).
In this environment, City companies will be accelerating spend on risk control, to the detriment of other areas of their capital and operating budgets.
One company that is likely to benefit is Lombard Risk Management (LRM), providing integrated regulatory compliance and collateral management solutions. LRM has recently reported record revenue and profits for the year to April 2013 (see: Lombard Risk Management, surging despite regulatory delays). At the end of June, the company announced a contract win for its Reporter regulatory reporting software with a major UK mutual business group and today made public a “significant” new contract to provide Reporter to a major wealth management subsidiary of a leading Asian bank in Hong Kong and Singapore. LRM is also beefing up its board with two non-executive directors, one of whom is John McCormick, presently Chairman and CEO of Royal Bank of Scotland Group, Asia Pacific.
With governments and regulators across the globe increasing their scrutiny, and regulatory management becoming ever more complex, LRM should be in a strong position as financial services companies reach out ever more desperately for help in this key area.