EU officials have proposed measures to enhance the anti-money laundering (AML) powers of the region’s top banking regulator. Under the plans, the European Banking Authority (EBA) will be able to request AML authorities in EU Member States to investigate potential material breaches – and to further request them to consider targeted actions, such as sanctions. The EBA’s powers will also be reinforced to ensure that, if national supervisory bodies fail to act on instances of money laundering, the EBA will be able to address remedial decisions directly to financial services operators as a last resort. In addition, the measures will establish a new, permanent AML committee to bring together the relevant, national authorities.
Commentators in the media have seen the plans as a response to a spate of high-profile money-laundering scandals, such as the Panama Papers revelations, the so-called ‘Global Laundromat’ scheme and the failure of Latvia’s ABLV Bank.
Announcing the plans in Strasbourg on 12 September, European Commission vice president and financial stability chief Valdis Dombrovskis said: “AML supervision has failed all too often in the EU. Today, we are enabling the EBA to make sure that different supervisors cooperate and exchange information and that AML rules are enforced effectively across EU countries. The EBA will also be entitled to request investigation into alleged breaches of the rules and will become Europe's phone number for cooperation with international partners on issues related to combatting money laundering in the financial sector."
For full details of the plans, click here.
Corporates are inconsistent in their approaches to internal leadership on cybersecurity issues, according to new research from the Economist Intelligence Unit (EIU) in partnership with advisory firm Willis Towers Watson. In a survey of 450 companies, the EIU found that almost 40% of executives consider it is the board’s responsibility to oversee cyber matters, while 24% feel that they are best left to a specialist cyber committee. A smaller slice of the respondents believe that an audit, risk or some other subgroup should handle the brief.
The survey also uncovered communication problems around this patchy picture of cybersecurity leadership. Only 8% of executives rate their chief information security officer (CISO) or equivalent above average in conveying the financial, staffing, reputational or personal risks of cyberthreats. Less than a quarter of executives think that their cyber-resilience board briefings are “well above average”. And less than 15% are prepared to give their CISOs or equivalent a top rating, on a scale of one to 10.
Willis Towers Watson global head of cyber risk Anthony Dagostino said: “It is no surprise that one of the main challenges companies face when implementing a cyber risk mitigation or resilience plan is the communication gap between the board and the CISO. Cyber resilience starts with the board because they understand risk and can help their organisations set the appropriate strategy to mitigate it. However, while CISOs are security specialists, most of them still struggle with adequately translating security threats into operational and financial impact to their organisations – which is what boards want to understand.”
Dagostino added: “To close this communication gap, CISOs need tools that can help them quantify and translate the vulnerabilities uncovered from their cybersecurity maturity assessments. These tools [will] enable them to better communicate the risk to the board, seek adequate budget and enable the board to provide meaningful guidance.”
April to June 2018 was a banner quarter for the UK’s asset-based lending (ABL) sector, according to new market data. Published by banking trade association UK Finance, the figures show that corporate ABL client numbers hit more than 40,300: a 1.1% rise on the same quarter of last year – and the highest quarterly level since 2015. The number of clients with a turnover of more than £10m rose to in excess of 5,000 – up 7% on Q2 2017.
Total cash advances to all client firms supported by ABL and invoice finance stood at £21.4bn at the quarter’s end – 1.9% down on the same quarter of 2017. The pure-play ABL segment (classed as lending against assets other than invoices) amounted to £4.3bn: 5.6% up on Q2 of last year. That activity was driven in particular by funding advanced against stock, which saw a year-on-year increase of 18%.
UK Finance managing director, commercial, Stephen Pegge said: “It is encouraging to see steady growth in client numbers… This is being driven partly by an increase in the number of larger businesses opting for this form of finance. We are also seeing the number of smaller clients and the funding provided to them remain steady, and the industry has the capacity and expertise to provide even more financing to these businesses in future.”
Almost half (45%) of the UK’s smaller companies cite a ‘poor understanding of SME businesses’ as the biggest challenge that banks face in meeting their needs. The figure emerged from a survey of 1,000 SME owners and senior decision-makers commissioned by fintech company Fraedom. The survey also found that almost a quarter (24%) of respondents think that banks ‘fail to prioritise SME needs’. Indeed, only 12% feel that banks deal fully with their business requirements.
When asked what actions their banks could take to provide more effective services, 46% of the respondents said: ‘simplify lending processes’. Other, popular messages were ‘be more proactive in offering advice and assistance’, and ‘provide a more personal, consumer-focused approach to engagement’.
Fraedom CEO Kyle Ferguson said: “SMEs clearly want banks to proactively engage with them, but they also want it to be easy for them to borrow money when they do so. The needs of an SME can often be very different to those of a large enterprise, so flexibility is key – especially in terms of offering market-specific advice and lending options.”
Hiring troubles have hit the offices of UK CFOs as the priorities of corporate finance departments undergo a pronounced shift. According to figures from Robert Half, many organisations have set their sights on digital transformation projects, creating a need for skills such as data analysis (cited as desirable by 43% of CFOs), financial analysis (35%) and data forecasting (34%). However, finding people with those abilities is proving a challenge, with 93% of UK firms struggling to attract qualified accounting and finance professionals.
The recruitment firm’s data – pulled from a broader survey of 5,000 CFOs in 14 countries – follows a recent report from consulting firm McKinsey, which notes that corporate demands for new skills will increase dramatically by 2030 as a result of technological innovation.
Robert Half UK managing director Matt Weston said: “Identifying the right candidate in this current war for talent means that businesses need to define what skills and qualities are required for a successful role – then focus primarily on these, alongside cultural fit. Defining the skills that can be learnt will allow businesses to expand their candidate pool and identify talent with the potential for long-term success… Training is key to ensuring that employees are productive and feel they have an incentive to advance and grow with the company.”