Development of cloud platform
The Bank of England functions as the central bank of the United Kingdom. As part of its role, the Bank of England acts as a regulatory authority for banking services in the United Kingdom.
After the financial crisis, it was accepted that one of the reasons for the crisis was the inability to promptly act on banking risk. As the process for measuring risk of banking portfolios was mainly conducted manually.
The challenge was to build a highly automated and scalable platform that allowed the regulatory authority to calculate risk associated to portfolios of any UK bank. The requirement was to build a platform that was cost-effective and could provide regular (as part of legislative requirements) or ‘on demand’ risk assessments.
Using virtualization and a high degree of automation, the Analytic Risk Technology (ART) project delivered a platform that scaled efficiently and rapidly based on demands. Costs savings were gained by only utilising a low degree of resources, but due to the effective automated approach, services could be scaled up in minutes.
The manual approach for measuring bank risk would typically take months and would be longer when implementing new financial models. The ART project was capable of producing risk reports for regulators in days, greatly improve the regulators’ ability to spot risky bank portfolios.