ReleaseWire Connect

The attention of the financial regulators in the UK is now turning towards cloud computing providers thanks to the potential problems that could arise for the financial services sector if one of them is hacked. As banking systems become increasingly reliant on cloud services, there is growing concern about the disruption that could be the result of a cyber-attack.

When the EU-wide GDPR was first introduced it was intended to tackle the way that big tech firms were mishandling data. However, although there have been some pretty hefty penalties levied against the likes of Google and Amazon, a few years on from the implementation of the GDPR it has yet to really demonstrate its intended impact.

Figures from late 2020 show that a spike in the level of deal activity over the course of the year last year meant that the European asset management sector hit a new $12Bn high in 2021. Asset management recruiters all over the region have been focused on helping firms to take advantage of this influx of merger and acquisition activity. As a whole, the transaction value for 2021 was almost double the numbers recorded for the year before in 2020.

Last month's COP26 triggered a wave of eco-driven decision making across the banking and financial services industry. In particular, there were a whole range of asset managers making pledges to reach net-zero greenhouse gas emissions for their investment portfolios by 2050. This includes most of the largest institutional asset managers in Europe. Only a few of these asset managers have revealed an interim net-zero target for 2030, a much closer deadline, but those that have are choosing to set relative rather than absolute targets (for example reducing carbon footprint by 50% compared to 2015). Most asset managers have signed the Net Zero Asset Manager Initiative (NZAMI), which gives them until next year to formulate such targets. The Net Zero Asset Manager Initiative has been a major driver in pushing the industry towards greater eco commitments. It now has 220 signatories with a combined total of EUR50 trillion assets under management.

The government's COVID-19 business loan programme was hailed as a great success earlier this year. However, now PwC has been called in to examine the fraud risks - and cases of actual fraud - that may exist within the loan scheme. The request has been made by the British Business Bank, which is a government bank that is owned by the taxpayer. It was set up in order to increase the supply of credit to small and medium sized enterprises and this won't be the first time that the bank has turned to advisors for support. In setting up and running the Future Fund, the British Business bank spent £13 million, as well as a further £7 million on advisor fees for work on loan schemes. In this case PwC will be looking at whether customers have either committed fraud or attempted to commit fraud - one estimate put defaults and fraud at 80% of small businesses in the Bounce Back programme.

One of the key learnings for banks and financial services as a result of the pandemic has been the way that third party suppliers are contracted and the risks that institutions may potentially be exposed to as a result of these relationships. The Deloitte 2021 Third Party Risk Management (TPRM) survey reveals how much work has gone into reviewing this as a result of the pandemic, and evolving the way that third party suppliers are dealt with in the future.

SPACs - Special Purpose Acquisition Companies - have attracted a lot of interest in the last year in the private equity world. Over the past 15 months, 10% of the SPACs raised have been backed by private equity firms. In many ways this represents a great match of two interests. SPACs can be a quick way to cash out on investments, an easier option for buying into a private business and another route to liquidity for investors and enterprises that aren't keen to go down the IPO route.

Petrol shortages in the UK have caused a lot of frustration for drivers - and also for suppliers - but has this really had any kind of measurable impact on investment markets? The major factor that could trigger this is inflation. Given recent circumstances there is a real risk that higher inflation could become a more persistent threat and that may well result in central banks prematurely tightening monetary policy - that is where the major issue for markets could lie. The challenges surrounding keeping inflation under control have been put under extra pressure by the supply chain problems this month and last, including production bottlenecks and a shortage of labour.

The world of financial technology is always evolving, driven by the necessity of creating new solutions to old obstacles and user needs. Clearbank is a cloud-based clearing bank that already has well established API-driven technology and Banking-as-a-Service (BaaS) and has recently announced an expansion. This comes in the form of a new multi-currency approach that is designed to reduce friction, allowing international transactions and offering UK and European based small businesses more options when it comes to multi-currency bank accounts and FX solutions.

Cryptocurrency may not initially have made a big impact in terms of attracting investors but this market has continued to expand and become a much more credible option. Now that digital assets are much better established, bitcoin etc represent a far more attractive choice. This has resulted in a whole host of quants and systematic traders migrating to cryptocurrencies and created many more options for those who are looking to pursue quant careers in the UK.