Corlytics provides the evidence-based intelligence required by firms to achieve positive regulatory outcomes. The company constantly monitors regulatory activity around the globe and ensures that customers are kept up-to-date with the latest information to ensure they are well positioned to proactively manage risk. Established in 2014, Corlytics helps clients across the financial services community deal with the increased prominence of regulatory risk following the financial crash of 2008.
“Regulatory risk was always there, but it was very much in the background up until 2008,” said Corlytics Chief Operating Officer, John Keane. “Risk rapidly rose in importance after that, and now there is a continuous stream of both new regulations and changes to existing regulations, which organizations might not be aware.”
Fines for breaches can be enormous and run to billions of dollars. The estimated annual cost of non-compliance to the banking sector alone also runs to billions of dollars. Regulatory risk is now as important as the other main risks managed by the sector.
“There are many risks to banks and financial institutions,” Keane notes. “Risks such as credit risk, foreign exchange risk, and equity risk are well modeled and well understood. Along came regulatory risk, and it now needs the same level of analysis and understanding as traditional financial risks.”
One difficulty faced by banks and financial institutions in dealing with regulatory risk is the language used to describe it. Regulations are typically written by legal regulatory professionals. Interpretation comes down to the written word and people’s understanding of its meaning. Banks tend to be much more numerically driven and need a numbers-driven approach to analyze and quantify regulatory risks and their likely impact.
Keane explained that what Corlytics does is bridge the gap between the two sides. The solution helps banks quantify and better understand regulatory risk. Corlytics works closely with the Financial Conduct Authority in the UK, who are recognized as the thought leader in the regulatory space. In this sense, Corlytics regards itself as part of the regulatory ecosystem.
“We translate regulatory notices into a common format, we monitor global regulatory content, and we use a variety of artificial intelligence (AI) and other systems to help customers understand which notices are relevant to them,” said Keane. “We have a global taxonomy that is applied on a consistent basis allowing organizations to view relevant content in a standardized way which helps them anticipate when risks are likely to arise, what the impacts might be, and how best to mitigate risks.”
The company’s target market is the world’s leading financial institutions. Headquartered in Dublin, with presences in London, New York, Boston, and Sydney, Corlytics is a global solution. Their core market is the Tier 1 and Top Tier 2 Financial Services organizations, with a recent focus on the US, the UK, and Europe, with a growing interest from Asia. Enterprise Ireland, the national export agency, has supported the company to make international connections.
“Enterprise Ireland adds significant value in helping us grow internationally by offering practical assistance, such as spaces for us to hold meetings in their excellent network of overseas offices,” said Keane. “And they make introductions between companies and executives at senior levels. At the recent MoneyConf event in Dublin, Enterprise Ireland held an event the day before, pairing up regtech and fintech firms with potential clients and partners — that is exactly the type of proactive assistance that is invaluable to companies such as Corlytics and their international partners.”