Deloitte’s Center for Banking Solutions published an interesting study on compliance based on a survey of 20 of the top 50 financial institutions in the U.S. As my friend Mark Macauley (his identity blog) has said to me many times, “compliance is a cost center”. Here are a few excerpts from the study that I doubt are unique to financial institutions….
- “As costs have risen, financial institutions appear to have responded more by applying people resources to monitor compliance versus technology resources to manage it. “
- “Only 10% of financial institutions reported that compliance information was always effective and 15% that it was always timely.”
- Compliance related spending has jumped from 2.83% of net income in 2002 to 3.69% in 2006.
- Of compliance spending, 18% was for computing infrastructure (hardware, software, etc) while 60% was for compensation (people presumably).
- Overall 95% of the respondents reported that their management and administrative employees were spending more time on compliance than before and fully 40% saying that the time they devote to compliance has increased by 22% to 25%.
Ouch. Talk about an area of opportunity for improvement.
Advertisements
