Russian bank Sberbank has integrated Numerix's Advanced Risk and Analytics to complete its bank-wide automation of financial market risk management system
As part of the multi-year project, Sberbank built a technology platform which included IT systems and modules allowing the management of various types of risks, namely credit and market risks. The platform was created with the use of distributed computing technologies like GridGain, nonrelational databases, such as MongoDB and Cassandra, as well as other modern technologies which ensure high productivity, according to Dzhangir Dzhangirov (pictured), CIB CRO at Sberbank.
'The IT program that we started several years ago required innovative solutions and a new approach to risk management,' said Dzhangirov. 'Despite the complexity and scale of this program, we successfully delivered a risk management system that is now used by Sberbank on a group level.'
As part of the project Sberbank utilizes Numerix analytics as a consolidated XVA solution across the bank. Numerix analytics and Numerix CVA have been deployed to calculate, analyze and limit exposures exotic for complex deals as well as XVA management for front office needs and pre-trade calculations, such as incremental CVA and FVA.
'The program dealt with tools involving complicated price and risk metric calculation models,' said Dzhangirov. 'To create this infrastructure, a strategic IT program was launched and we selected Numerix as one of our transformation partners. Being the recognized leader in risk technology, especially for CVA and cross-asset analytics, Numerix stepped in to work with us to produce and distribute our counterparty credit risk calculations.'
'With Numerix CrossAsset and CVA underpinning its analytics infrastructure, Sberbank is driving towards a more open, fintech oriented, digital financial services market for itself and its customers,' said Steve O'Hanlon, chief executive officer of Numerix.
The rise of the digital disruptors is amongst the biggest challenges facing the financial sector, according to Russia's Sberbank, hence the move towards becoming a fintech platform which was unveiled in Q£ 2016.
Numerix's functionalities will also provide Sberbank the technology infrastructure to launch a structured products platform that will target a growing base of so-called individual investment accounts (IIAs).
IIAs allow for tax-free investment in notes, and Sberbank's upcoming platform could serve as a catalyst to growing the structured products retail sector in Russia.
Sberbank's Markets platform, which is the bank's forex trading tool for wholesale clients, would also be expanded to incorporate products like money market, dual currency deposits and other fixed income related products, while the forex functionality could also be extended to the retail segment.
It's not clear how the Russian bank is seeking to implement strategy in the structured products market following the departure of the bank's head of the structured products group, Erwin Parviz, who was responsible for building and expanding the bank's structured product group, its products offering, origination and distribution capability as well as for enhancing the infrastructure to support its growth.
A Sberbank spokesperson declined to comment on the reasons for Parwiz departure or who will take over his responsibilities.
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