Speaking at the SWIFT Business Forum London earlier this year, representatives from Deutsche Bank, BNP Paribas and Lloyds Banking Group told executives that they needed to become better at data sharing and interpretation.</p> David Deane, group head of client and data services at Deutsche Bank, said banks need more efficient ways to service low-risk customers, enabling them to devote additional resources to managing the needs of higher risk customers.</p> He said: “The biggest change we have to make is being able to focus on our highest risk customers. We put so much time and effort into managing a very large proportion of clients.”</p> “..20% of our clients, we would put into a high risk category. We put an exorbitant amount of effort in dealing with the 80%. We have got to try and solve that problem for the low risk clients. A big focus for us is to automate as much as we can in the low risk space.”</p> Deane said the industry is increasingly having to anticipate where regulators, politicians and society may direct regulation in future, amid global public scandals which have driven the regulatory agenda since the financial crisis.</p> He added: “We have to be one step ahead of the regulators in many ways by looking at our policies to stay ahead of that. The minds of politicians, regulators and societies change very quickly.”</p> Cate Kemp, global transaction compliance director at Lloyds Banking Group, said the industry should have a greater understanding of the data that it already has to keep on top of potential risks.</p> She explained: “As an industry, we are out chasing information when we have shed loads of it already. In the gold rush of chasing more data, we run the risk of not sweating out what we have already.”</p> “This is about being able to crunch data points to get information. We can do that scientifically and we can do that through third parties. My advice is to start small.”</p> Jean-Marc Guiteau, global head of compliance operational risk at BNP Paribas, said businesses could still benefit from further clarification on what is required of them for KYC purposes, however.</p> He said: “The requirement from regulators is that we have an end-to-end view of the customer, all the investors and intermediaries. We can address this by doing due diligence, we can address it through information-sharing but it remains a real concern and the regulations are not really clear for the time being. That is what is keeping me awake at night.”</p> Kemp suggested that deep analysis is the key to truly knowing banking customers, suggesting that firms couple traditional due diligence with dynamic transaction monitoring.</p> Deutsche Bank’s Deane called on the industry to engage business partners in order to become better at understanding their customers. He said: “As an industry we need to work with SWIFT. They are part of our DNA. They can help us to start mapping other behaviours and patterns which can help us.”</p> Separately, Lloyds Banking Group’s Kemp said it was important that financial leaders underscore the importance of risk management in a corporate culture if compliance issues are to be truly embraced by all members of staff. She said: “It starts at the top. Unless you have visible leadership you may as well rip [the compliance manual] up.”</p> Deutsche Bank’s Deane added that some teams in banking organisations have taken longer than others to recognise the importance of risk management and KYC, but said that all departments are now buying in.</p> He said: “The relationship management teams… are taking some time to understand what their client is doing… and not just because of the next revenue opportunity. There has been a marked change here in the past four to five years.”</p> </p>