Deloitte and Cloudera create compliance service in the cloud

CloudProfessional service company Deloitte and cloud operator Cloudera have launched a jointly created cloud service that helps financial services people meet their compliance obligations more easily. It aims to specifically ease the workload created by the supervisory rules of the capital analysis and review (CCAR) process.

The Deloitte CCAR service aims to help companies cope with the masses of data needed to stress test financial products as regulations constantly change. Annual CCAR supervisory rules regularly specify new scenarios and datasets to be used in credit risk, liquidity risk, market risk, pre-provision net revenue (PPNR) and capital management models.

The cost and time involved in constantly processing these complicated variables, in order to generate the forecasted stress estimates, is escalating as the number of quarterly and yearly models multiples, according to Deloitte.

The Deloitte-designed solution includes accelerators to streamline data selection, data quality, variables conversion, data ingestion and management and to convert or migrate models to the SAS DS2 or Apache Spark or Python programming languages.

Cloudera was approached to use its expertise in Apache Hadoop open source software frameworks in order to create the visualization and dashboard tools promised in the system. The tools are designed to interact with the results of stress tests so they can quickly identify trends and potential sources of risk.

Deloitte built accelerators in Spark that cater for a wide variety of contingencies, which cuts the cost and risk of migrating existing CCAR models into an open source environment at first and into  the SAS DS2 once it is released.

“The current regulatory environment that our clients face is more complex than at any time in history,” said Ashish Verma, director at Deloitte Consulting LLP. “This complexity in regulation has led to complexity in data management, making compliance very costly with little benefit to the business.”

Cloudera has created a ‘cost effective solution’ to the problems faced by clients, said Verma, “storing this data within Cloudera Enterprise means companies can perform additional non-compliance analysis and potentially develop a deeper understanding of their businesses.”