With over 10 years experience working solely in the Data & Analytics sector our consultants are able to offer detailed insights into the industry.
Visit our Blogs & News portal or check out our recent posts below.
Ewan began his recruitment career in 2015, joining Harnham as a member of the Credit Risk team. His understanding of the market and ability to deliver service excellence to his customers has seen him progress to Managing Consultant level where he now runs the Risk Analytics team. Ewan continues to use his expertise to drive Harnham’s Risk Analytics services into new markets.
With over 10 years experience working solely in the Data & Analytics sector our consultants are able to offer detailed insights into the industry.
Visit our Blogs & News portal or check out our recent posts below.
This is Harnham’s weekly news digest, the place to come for a quick breakdown of the week’s top news stories from the world of Data & Analytics. BBC: International Women’s Day: Illustrating the COVID-19 pandemic This incredible article from the BBC reflects on the volatility of the past year and the aftershocks all of us have suffered as a direct response to the COVID-19 pandemic. One huge issue faced by many is the sheer volume of information we are given daily around the pandemic, and how overwhelming it has become for many of us to take in. Author, Dhruti Shah, speaks to three female pioneers in the fields of science, health and technology who have been using their artistic talents to help us understand and battle coronavirus in a simple, digestible and visual way. For example: “Avesta Rastan, 25, is a visual science communicator currently living in California. At the start of the pandemic, she realised there weren't many infographics revealing how Covid-19 directly affected the human body. So, the artist, who is of Iranian and Canadian heritage, and is a member of the Association of Medical Illustrators, saw a unique opportunity to use her skills and her training in pathological illustration (the drawing of disease) to help the wider public." "I saw lots of illustrations and 3D models of the virus itself and its protein, but I didn't really see what it did to us," she explained.” To read more on this, click here. Open Access Government: How to tackle the gender gap in artificial intelligence There’s no denying that Data & Analytics is an incredibly male-dominated industry, especially across areas such as Machine Learning and AI. Reports show that 26 per cent of the Data and AI industry is made up by women, with the findings going on to say that the lack of representation in senior roles is a real ‘turn off’ for any women considering entering the industry. In this article by Open Access Government, five key areas are highlighted that must be implemented if we are to challenge and change the stereotypes in the industry currently and encourage a more equal workforce.These include: Fix the STEM gap to reduce bias in development: “With women representing a percentage of only 20-25 per cent of the sector, technological developments will be skewed,” Andrea Mandelbaum, President and CEO of Mc-Luhan says.The battle for diversity starts in education: Dr. Angela L. Walker Franklin struggled to find mentors who had the same lived experience as herself, “despite many years of talk of diversifying leadership in higher education.” It’s time to start practicing what we preach from school. Defying gender roles and expectations is key to career success: Liliana Mantilla who works as a Cognitive Delivery Manager at Amelia, an IPsoft Company, describes previous roles in which she felt she “had to work twice as hard as fellow male colleagues.” Men need to get involved in the conversation to help create change. Read more on this here. KDNuggets: 9 skills you need to become a Data Engineer KDNuggets gives some fantastic career advice to the next generation of Data Engineers, of which there is a growing number. As the industry becomes more competitive, there are 9 key areas candidates need to focus on to clinch that dream job. SQL - “Strong SQL skills allow using databases to construct data warehouses, integrating them with other tools, and analysing that data for business purposes.”NoSQL - “Examples of NoSQL include Apache River, BaseX, Ignite, Hazelcast, Coherence, and many more others. You’ll definitely get across them during your data engineer job search, so knowing how to use them would be a huge advantage.”Python - “Data engineers are expected to be fluent in Python to be able to write maintainable, reusable, and complex functions.”Amazon Web Services (AWS) - “If you’re interested in learning AWS, you might want to try online courses or Amazon’s own tutorials"Kafka - “60 percent of the Fortune 100 companies use Kafka for their applications.” For the next four key skills you must know to become a Data Engineer, read the full piece here. AdExchanger: Inside Disney’s plan to automate half its ad business within five years Disney has announced very ambitious plans to automate over half of its ad business over the next five years. As part of this plan, the animation giant has created a programmatic exchange, also known as Disney Real-Time Ad Exchange (DRAX), which will allow any potential buyers to compete for all Disney ad impressions. Lisa Valentino, Disney Ad Sales EVP of client solutions and addressable enablement said: “Automation and data is really the underpinning of the Disney Platform, that is a new way of clients doing business with us.” This need to move to a much more automated way of working comes after Disney’s multitude of partnerships which have manifested over the past few years, including Hulu, the Trade Desk and Google. Valentino continues: “We’re democratizing the client pool and allowing clients to better plan for access to Disney.” Read more on this story here. We've loved seeing all the news from Data & Analytics in the past week, it’s a market full of exciting and dynamic opportunities. To learn more about our work in this space, get in touch with us at email@example.com.
12. March 2021
This is Harnham’s weekly news digest, the place to come for a quick breakdown of the week’s top news stories from the world of data and analytics. KDNuggets: 20 core Data Science concepts for beginners The field of Data Science is one that continuously evolves. For Data Scientists, this means constantly learning and perfecting new skills, keeping up to date with crucial trends and filling knowledge gaps. However, there are a core set of concepts that all Data Scientists will need to understand throughout their career, especially at the start. From Data Wrangling to Data Imputation, Reinforcement Learning to Evaluation Metrics, KDNuggets outlines 20 of the key basics needed. A great article if you’re just starting out and want to grasp the essentials or, if you’re a bit further up the ladder and would appreciate a quick refresh. Read more here. FinExtra: 15 DevOps trends to watch in 2021 As a direct response to the COVID-19 pandemic, there is no doubt that DevOps has come on leaps and bounds in the past year alone. FinExtra hears from a wide range of specialists within the sector, all of whom give their opinion on what 2021 holds for DevOps. A few examples include: Nirav Chotai, Senior DevOps Engineer at Rakuten: “DataOps will definitely boom in 2021, and COVID might play a role in it. Due to COVID and WFH situation, consumption of digital content is skyrocket high which demands a new level of automation for self-scaling and self-healing systems to meet the growth and demand.” DevOps Architect at JFrog: “The "Sec'' part of DevSecOps will become more and more an integral part of the Software Development Lifecycle. A real security "shift left" approach will be the new norm.” CTO at International Technology Ventures: “Chaos Engineering will become an increasingly more important (and common) consideration in the DevOps planning discussions in more organizations.” Read the full article here. Towards Data Science: 3 Simple Questions to Hone Python Skills for Beginners in 2021 Python is one of the most frequently used data languages within Data Science but for a new starter in the industry, it can be incredibly daunting. Leihua Yea, a PHD researcher at the University of California in Machine Learning and Data Science knows all too well how stressful can be to learn. He says: “Once, I struggled to figure out an easy level question on Leetcode and made no progress for hours!” In this piece for Towards Data Science, Yea gives junior Data Scientists three top pieces of advice to help master the basics of Python and level-up their skills. Find out what that advice is here. ITWire: Enhancing customer experiences through better data management From the start of last year, businesses around the globe were pushed into a remote and digital way of working. This shift undoubtedly accelerated the use of the use of digital and data to keep their services as efficient and effective as possible. Derak Cowan of Cohesity, the Information Technology company, talks with ITWire about the importance of the continued use of digital transformation and data post-pandemic, even after restrictions are relaxed and we move away from this overtly virtual world. He says: “Business transformation is more than just a short-term tactic of buying software. If you want your business to thrive in the post-COVID age, it will need to place digital transformation at the heart of its business strategy and identify and overcome the roadblocks.” Read more about long-term digital transformation for your business here. We've loved seeing all the news from Data and Analytics in the past week, it’s a market full of exciting and dynamic opportunities. To learn more about our work in this space, get in touch with us at firstname.lastname@example.org.
15. January 2021
We were recently LIVE with Jonathan Ward, CEO and Co-Founder of Genome Biologics to discuss how AI, computational platforms and Data and Analytics have changed and accelerated the research and development of drugs in Biotech and Pharmaceuticals. Jonathan is a specialist in cardiovascular disease, one of the biggest killers globally. Annually, Cardiovascular Disease accounts for 17 million deaths, one-third of all deaths worldwide. His main line of work is in exploring and implementing how an integrated computational and biological approach to research and development can accelerate the creation of successful cardiovascular drugs, in a more financially and time efficient way. Genome Biologics was founded to spur the innovation that is often missing in the field of cardiovascular drugs. This unmet demand stems from the combination of expensive trials and high failure rates. However, Genome Biologics came up with a smart system, using both computational and biological systems, which allow the team to better predict failure before it happens. This amazing technology not only help increase success rates but makes the research more financially viable and a lot more attractive to potential investors. How does it all work? The team starts with the computational side. Here they screen large amounts of data which comes from a diverse range of sources, including public repositories, and the main aim of this process is to identify matches between gene expressions in heart disease or heart failure and a drug, or a mixture of drugs, that can change those gene expressions. The result of the gene therapy derives mostly from the integrated biological platform, where the team can validate the drugs used. Using real hearts, the team test the drugs screened by the computational research and see which ones improve the heart function. These drugs then go through the lengthy process of clinical trial which can take anywhere between seven to 15 years to complete. Using the technology for COVID-19 Jonathan and his team were approached early in the pandemic to see if their technology could help find a vaccine for COVID-19. Initially, the team said no due to the understanding that COVID-19 was a respiratory virus only. But as research continued and the virus was found to also affect the heart and other vital organs, Jonathan and his team looked at how they could apply their technology to identify any therapeutics. The team applied the computational system to filter out all the compounds within the coronavirus, looking at how these affected or changed the heart. The team were able to filter 5000+ compounds down to around 500 that were potentials for a repurposing approach to COVID-19. The idea was that they would be then be able to identify a drug, or a combination of drugs, that could boost the immune system and heart function to fight off the disease. In our event, Jonathan noted that, for all the vaccines being trialled and released to market over the past nine months, the computational approach has been favourable across the board from small labs to Pharma and Biotech giants, such as Pfizer. And, as we’ve seen in only the last few days, this approach has been incredibly successful as 90-year-old Margaret Keenan was one of the first people in the UK to vaccinated against COVID-19. Challenges for the industry post-pandemic COVID-19 has forced the Data and Life Science industry to evolve and adapt quickly and efficiently in order to work under pressure and find viable treatments in a much shorter timeframe than usual. The past nine months has most certainly provided learnings that the industry can take with them into any future work but, of course, the field constantly evolves, and this ever-changing nature will undoubtedly create hurdles to overcome. Genome Biologics explained that handling and managing data will be the biggest challenge for Biotech companies moving forward, simply because of the sheer scale and amount being produced. The volume of data, while important, is overshadowed by the need for high-quality data. As Jonathan points out, “If you put in junk, you get junk out” and so, the focus will very much be on getting hold of and using good data from reputable sources to ensure research and drug creation can be done efficiently and effectively. The future of data As we move forward, especially post COVID-19, there will be a lot more computational data analysis being used in the interpretation of medical information and data, which is both very advanced and exciting for the industry. However, this does mean that certain roles within the industry may become redundant, most likely pathologists. Pathologists are a large cost for many companies, as well as the hardest employees to source, making this element of research a very arduous and expensive problem. With the large uptake of computational systems, companies will be looking at creating a much cheaper and highly automated system. Not only will this reduce costs and time, but it will also greatly reduce the risks of human error in misinterpreting data. The further implementation of computational data in drug testing, means that there is a good chance human error could be eradicated from the industry in the next decade which would make a huge impact on the healthcare industry. Of course, there will always be limitations to consider. Here, no matter how good your computational platform is, you will always need the biological platform as the biological element is just as, important, if not more so, as the computational side. And so, humans will need to work together with advancements in technology to create an efficient and integrated system. Pharma, Biotech and drug discovery will never be a robot-only industry. Where should I start if I want to work in drug discovery? With decades of experience in the industry, Jonathan explains how to break into drug research, explaining that you need to have a clear understanding of the vision, mission and types of projects that are undertaken. Jonathan outlined, “Ultimately, it all depends on the kind of companies you want work for. What I can say however is that smaller Biotech companies are perfect for those who want hands-on work. These firms are more dynamic, you are likely to be involved in more projects and thrown into the deep end and ultimately learn a lot more. In big pharma, your experiences may be a little more limited across daily tasks, projects and progression.” There are a few key questions to look at as a professional already in the discipline: What can you contribute to the role that someone else can’t? What do you want to get out of the role? Working in drug discovery, research and a role that challenges a range of core issues in Life Science can be incredibly rewarding, but as Jonathan notes, “Make sure this job change is really what you want before you jump in. Like any role, do you research and get to know the role and company inside out.” Over the past nine months, Harnham has seen an increase in the number of in-demand positions across the Data Analytics and Life Science industry. With our unique understanding of this arena and excellent relationships with some of the best organisations around, whether you are a client or a candidate, we can offer bespoke solutions to suit your needs. If you’re hoping to change career or are looking for the next member of your team, we can help. Take a look at our latest opportunities or get in touch with one of our expert consultants to find out more. To watch this LIVE event in full, please visit: https://www.linkedin.com/video/live/urn:li:ugcPost:6727579805614673920/
10. December 2020
Instant transfers, real-time payments, virtual banks, and digital currencies - these are just a few of the ways fintech innovation has been booming in the last few years. Around the globe, start-ups, upstarts, and non-bank payment providers have shaken up the banking status quo. New technologies, market conditions, and alternative business models fueled by global investment offer much needed change in payment systems as well as complement others already on the market. Demand for optimised payments experience in terms of speed, convenience, and multi-channel accessibility are the new ways to pay. How to pay- let me count the ways Retail and traditional banking have moved away from slow batched processing as consumer demand drives real-time payment systems. This demand has Consumers in retail banking also benefitting from the development of payment systems that run in real-time rather than via the traditional (and relatively slow) method of batched processing. This demand has in turn furthered innovation in real-time payment infrastructures. Consumers no longer require a bank or credit card to make payments, but can instead use service layers that run on top of existing real-time payment infrastructures. In our mobile world, mobile wallets are often at the forefront of thought for payment systems and with the rise of P2P payment such as Venmo, Square, and Klarna. While generally focused on the peer-to-peer (P2P), mobile capabilities are much smaller in the wholesale and corporate sectors. But, this won’t last for long. Projected smartphone growth offers banks an opportunity to adapt and consider solutions across devices to meet growing demand. An increasing number of non-bank providers are entering the payments world as well. Consider the rise of digital currencies, foreign exchange and remittances, and other P2P models which enable users to buy and sell currencies directly at an agreed rate. Real-time technological innovation reduces currency risk faced by banks and money transfer agencies, while also lowering costs associated with money transfer. Growth in e-commerce makes consumer and retail payments sector the fastest moving in terms of innovation and adoption of new payment capabilities. Renewed confidence in the financial services sector has led to a substantial rise in available jobs, particularly among risk management teams. Yet, professionals to fill these roles remain in short supply. Roll out the red carpet- these are the roles in high demand Against the U.S., Japan, and globally, the U.K. faces a skills shortage in risk functions. According to a report by Accenture, over 75 percent of organisations say a shortage of core risk management talent impedes their effectiveness. Just over 70 percent are facing a shortage in new and emerging technologies. With an eye to the future, many organisations, capital markets, and U.K. banking plan to strengthen their understanding of emerging technology risk and their data management capabilities. Roles in highest demand are those in counterparty credit risk, particularly within pricing. While more recently, graduates with quantitative backgrounds found roles in risk methodology, real-time payment structures and the role of e-commerce has created more opportunity for those who candidates who understand pricing models. Those at the first line of defence in regard to assurance, internal audit, IT controls, and cyber security fall within the scope of operational risk functions are also in demand. The role of Brexit programmes will drive risk change hires in 2018. As negotiations become clearer, other organisations are expected to follow an investment bank in Canary Wharf which has made credit risk function hires a top priority. Top challenges in risk management function Increased demand from regulators, increased velocity, volume of data, legacy technologies, and variety are the top challenges faced by U.K. banking and capital markets. To meet their needs, these organisations are focused on creating teams which blend core competencies, a deep understand of new digital capabilities, and commercial acumen. Quantitative risk professionals with experience in counterparty and market risk analysis are in high demand as well as those with a pricing model focus. Demand for regulatory and portfolio level market risk managers have also seen an uptick in demand. In order to overcome shortages, businesses are considering internal candidate pools and moving strong candidates between asset classes. Despite shortages of professionals with key skill sets within risk, employers have remained cautious. Quantitative risk roles are a notable exception, where skills shortages are most acute. We have an opportunity for a Senior Credit Risk Manager within New Product Leadership to help build a leading Financial Service’s recently purchased Consumer Finance Portfolio. Shape the entire strategy, oversee all Scorecard and Model Development, and build your own team. Interested? For additional opportunities check out our current vacancies. Contact our UK Team at 0208 408 6070 or email email@example.com to learn more.
11. January 2018
By 1 January 2018, the International Accounting Standards Board will have introduced IFRS 9 as a mandatory measurement model for financial assets. Due to this, I thought I would break down what this means for business and how it will impact recruitment trends over the next one to two years. What is IFRS 9? IFRS 9 is an International Financial Reporting Standard which is responsible for the accounting of financial instruments. It includes requirements for recognition and measurement, impairment, derecognition and general hedge accounting. Since July 2009, IFRS 9 has been implemented in various stages whereby the IASB has been adding to the standard as each stage has been completed. What were the downfalls of IAS 39? IAS 39 was first implemented by the IASB in 1984 and its predominant aim was to ensure there were rules for the reporting of the financial instruments ensuring that companies would then present them in a way which was consistent, but also transparent. However, following a G20 summit in 2009 after the financial crisis of 2008, it was decided that IAS 39 needed to be changed due to the fact there were too many exceptions and inconsistencies and the project to replace it went ahead imminently. IAS 39 was often considered to be very backward looking, meaning that it failed to give a true and fair view the financial position of a business. Perhaps more crucially was its inability to respond fast enough to the recognition of credit losses, which was evident in the financial crisis of 2008. IFRS 9 at a glance The main difference between IAS 39 and IFRS 9 is that instead of loan provisioning using an incurred loss model, they will be using an expected loss model. Despite the Financial Account Standards Board (USA) using a single measurement model, the IASB decided that a three-stage model would be more appropriate. Stage 1 will include financial instruments which have had no noticeable increase in Credit Risk since their initial recognition or that have low credit risk. Stage 2 will include financial instruments which have had a noticeable increase in Credit Risk since recognition, however, does not have evidence which suggests that they have been impaired. Stage 3 will include any financial instruments which have had a noticeable increase in Credit Risk since recognition and have evidence that they are impaired. In the table below I have compared IFRS 9 in its three stages to how things would look if IAS 39 used the same technique. Will IFRS 9 eliminate the possibility of a repeat of 2008? In my opinion, the simple answer is no. Evidence, without a doubt, suggests that under excess financial pressure, banks should be able to withstand it without any major implications. However, despite this, I am not convinced that any reporting standard put in place would be able to prevent another crash. Nonetheless, it is important that all financial institutions become compliant by the impending 1 January 2018 deadline, meaning financial reporting managers who can work on the implementation of IFRS 9 are now in high demand. Due to the significant impact of this change, we know that those candidates with strong ACA, CIMA and ACCA backgrounds, who can efficiently manage key programmes, will shape how well the implementation of IFRS 9 takes place for a company over the next two years. Are you such a candidate and what is your experience of the changes that are taking place? Will these new Standards be robust enough to protect institutions and the public? As a business, are you ready or on track to have these Standards fully implemented in time for the 2018 deadline? If, from a recruitment perspective you need more advice or insight surrounding how we can help you get your company IFRS 9 ready, get in touch with me - T: (020) 8408 6070 E: firstname.lastname@example.org
11. May 2016
KPMG, the global accountant and consultant has announced the formation of KPMG Capital, which will invest in big data and data analytics companies in Europe and beyond. Headquarterd in London, KPMG Capital says it will primarily invest in big data and analytics businesses through strategic acquisitions and technology partnerships. A growing fund The initial value of the fund is believed to be worth $100 million (£66 million), and when required the KPMG Capital fund will be topped up with cash from its parent company. Click here for the article on the web.
11. November 2013
Martin Brennan, Customer Insight Manager with Permanent TSB discusses how Customer intelligence software helps Permanent TSB offer customers what they want, when they want it.Bankers often use marketing analytics to figure out how to sell their products and services. At Permanent TSB, analytics also drives the kinds of products we offer in the first place. By “reverse engineering” the process, we’ve created products and services that better meet our clients’ needs.Historically we took the blanket approach to marketing – everyone got the same message. We might send marketing messages on mortgages to a retired couple with a paid-off house and to a 25-year-old with no need for one. When we started using analytics, we began to segment customers so that we could target the messages. This dramatically increased the effectiveness of our messages – as it should – because the targeted messages aligned more closely with the customer’s wants and needs.Reverse engineeringNow we are using the analytical insights to inform our product development decisions. This is critical and has helped us reshape our products over the past two years – offering more Web and mobile applications, and providing loan products that will appeal to a customer base that is recovering from the recent recession. Analytics helped us see that people increasingly want “simple” products – and that’s what we’re offering.As we’ve increased our use of analytics, we’ve also discovered two key things worth sharing:One question leads to another. When you start working with analytics, you end up asking more questions than you ever thought possible. Each answer spurs another round of questions. That helps drive modernization and improvement.Visual analytics tools matter. To articulate the insights from data, you need to present them in a way that doesn’t require an analytics background to understand. Being able to present the data visually is probably as important as trying to get the data.Although we aren’t there yet, we are working toward making sure that when a customer contacts us we know exactly the right offer to provide them. After all, if they are contacting us, it’s highly probable that they are actively looking for a financial product. We are utilizing our analytics to prompt our staff to offer just the right product.Catching the analytics feverIn addition, our early successes in marketing caught the attention of other units in the bank. A lot of other internal customers are looking for customer information that we might be able to supply. A good example is in the collections environment: We’ve unearthed some customer insights that allow collections to focus its efforts a little bit more in certain areas.There is one area that we aren’t that focused on yet – the whole big data area. We’re a midsize financial institution in a country of four million people. Maybe it is because the analytics solution we’ve deployed is taking care of our needs so well that we aren’t looking to adopt a big data solution right now. It is definitely something we’re watching, though. Click here for the article on the web.
03. October 2013
Nottingham-based credit card company Capital One has won 'Europe's Best Workplace' in 2013 in the large company category by Great Place to Work®. The annual ranking is the most comprehensive study of organizational culture in the world and identifies, on this occasion, the 100 Best Workplaces in Europe.The announcement comes just two weeks after Capital One was rated the UK's number one best large employer in the UK 'Best Workplaces' Awards for 2013.Each year, the Great Place to Work® Trust Index forms a key part of the assessment process, in which employees are encouraged to represent their honest views and perceptions of their employer. Feedback from over 650 Capital One respondents was that employees felt 'valued and part of the business', with a strong appreciation for its 'great culture of fun & work life balance and 'genuine focus on the community'.Capital One is dedicated to its vision of 'Let's make lives better' and each year, takes a day out to celebrate this, which employees feel helps to unite the business. Employees are also encouraged to participate in its annual festival - Visionfest - which showcases the best of employee talent.Brian Cole, Managing Director at Capital One said: "To receive this level of recognition on a European scale is fantastic. We have been working extremely hard to turn our strategic vision - 'Let's make lives better' - into a reality so this award is testament to the commitment and hard work of all our employees."We are constantly striving to create and maintain a working environment that supports and motivates our people. Capital One has a unique culture, which is firmly underpinned by our vision and we are certain that this has been the key driver of our success as an organization."Robert Levering, Co-Founder and Global CEO of Great Place to Work® said: "Companies in this year's ranking are developing organizational cultures dedicated to building trust and camaraderie among their employees. Inclusion on this list reflects companies' commitment to continuously improving the quality of life of employees and setting new standards for organizations in the future."Capital One is dedicated to its vision of 'Let's make lives better' and each year, the whole business takes a day out of the office to celebrate this. Employees are also encouraged to participate in its annual festival - Visionfest - which showcases the best of employee talent. Capital One was second in the Great Place to Work® 'Best Workplaces' awards for 2012 and has climbed to top spot this year. In addition, the company was shortlisted for Best Financial Services Provider by Which? in 2012.Great Place to Work® launched the first Best Companies to Work For list in conjunction with Fortune magazine in the United States and Exame in Brazil more than 20 years ago. Great Place to Work® now recognizes workplaces in nearly 50 countries. For the 2013 Best Workplaces in Europe lists, Great Place to Work® analyzed data provided by more than 2.100 companies that represent more than 1 million employees.Click here for the article on the web. And click here for the full list of companies recognized.
27. July 2013
FICO, a leading predictive analytics and decision management software company, and Efma today announced the results of the seventh European Credit Risk Survey, which measures retail bankers´ outlook for the availability of credit along with their investment priorities for the year ahead. In the February survey, completed by 130 credit risk professionals from 41 countries, the forecast for a “credit gap” between credit supply and demand fell sharply from the last survey, conducted this past fall. For consumers, the projected gap was just 4 percentage points, with 30 percent of respondents projecting some increase in the amount of credit requested and 26 percent projecting an increase in supply. By comparison, in the autumn 2012 survey the spread between projected demand and supply was a full 20 percentage points. For small businesses, the gap was even smaller. In the new survey, 31 percent of respondents reported that they expect the aggregate amount of credit requested by small businesses to increase, and 29 percent expect the amount granted by lenders to also increase. “Most of the new business growth in our corporate sector is coming from the SME segment,” said Dr. Cüneyt Sezgin, board and audit committee member at Turkey´s Garanti Bank in the FICO/Efma report. “Loans represent the primary relationship between banks and SMEs, as other financing alternatives for smaller companies are not well-developed in this market. Cash loans to SMEs represented 37 percent of total Turkish lira cash loans in 2012, and this ratio has been continuously increasing.” “Despite the economic challenges in many countries, lenders are telling us they´re prepared to meet a modest increase in credit demand,” said Mike Gordon, senior vice president for FICO sales, services and marketing. “Given last month´s report that European banks have dramatically cut their Basel III capital shortfall, it appears that they gradually may be able to make more capital available for borrowers.” European bankers also laid out their priorities for investment in analytics. More than 40 percent of respondents reported they will invest in improving their analytics, with the highest priorities being credit risk models for both new credit applicants (61 percent of respondents) and existing customers (50 percent). In addition, 38 percent of respondents said they will increase their investment in risk analytics that incorporate Big Data. “Although consumer lending is a mature process using analytics to support risk classification, marketing, underwriting and authorizations, predictive models must constantly be calibrated to accommodate changes in consumers´ behavior,” said Manuel Goncalves, director of the Risk and Decision Models Unit at Portugal-based Millennium bcp in the report. “These changes are driven not only by the adverse economic context but also by greater mobility and social networking. At the same time, there are new and richer sources of data that can be used to improve risk management and deliver a better customer experience.” The delinquency forecast was nearly unchanged from the last survey, with at least 40 percent of respondents forecasting an increase in delinquencies during the next six months on mortgages, credit cards and small business loans. “We don´t expect a reversal of this trend until the economies of Europe show greater recovery,” said Patrick Desmarès, secretary general of Efma. “That said, Europe is a heterogeneous region, with some countries preparing for a triple-dip recession while others, such as Turkey, look quite robust. The uncertainty across much of the region is particularly challenging for multi-national banks.” Click here for the article on the web.
24. April 2013