Coherent and consistent data is critical to the success of effective supervision, with central banks and standalone regulators requiring well-managed data from a wide range of sources to fully understand the entities under their supervision.
Recognising this data requirement has been the cornerstone of Vizor Software's success, as it has sought to use technology to improve the speed and effectiveness of financial supervision. The Irish company's platform supports all aspects of supervision, from licensing and authorisations to submission, validation and analysis of prudential data, risk profiling, market reports and public complaints, with a modular format that allows agencies to adapt the technology to suit their needs.
"We had been looking to enhance our reporting platform for several years and selected Vizor after a competitive bidding and evaluation process," says an official at the Central Bank of the Bahamas. "We have seen improvement in our ability to run reports and share information with our sister regulators, and have found Vizor to be very supportive."
The central bank implemented a reporting and information management system using Vizor's technology in 2015 to improve its data collection, validation, storage and reporting capabilities. But Vizor also worked with the Securities Commission of the Bahamas and the Insurance Commission of the Bahamas to strengthen and align the reporting infrastructure across all three entities.
The Bahamas project is one of a number of recent successes for Vizor in the Caribbean, with others including Bank of Jamaica, which went live with its technology for data collection and dissemination, risk monitoring and reporting in 2016 after an eight-month implementation period.
The Caribbean client wins have coincided with a period of major transition for Dublin-based Vizor, which started out in 2000, mainly as a consulting company. In 2011, it began to invest heavily in research and development to become a dedicated technology provider to central banks and regulators. It now splits its services into three core products: Vizor Regulatory Returns Management, covering the data requirements; Vizor Risk-based Supervision; and Vizor Licensing and Regulatory Transactions.
Vizor's success speaks for itself. Its turnover has increased from €500,000 in 2011 to €13 million in 2015 and its pace of client acquisition has also accelerated. Since 2014, its technology has been implemented at a number of high-profile institutions, including Bank of Canada, Bank of England and the Saudi Arabian Monetary Authority (Sama).
"We have really come into our own in the last few years," says Conor Crowley, joint chief executive of Vizor. "Our technology supports the full supervisory process, but the common thread between all the central banks and regulators we serve is the data collection challenge they face. They often get bogged down in data that is incomplete, incorrect or not on time, and that's where we can deliver the most value."
We have really come into our own in the last few years. Our technology supports the full supervisory process, but the common thread between all the central banks and regulators we serve is the data collection challenge they face
Conor Crowley, Vizor
Vizor's success in Canada appears to have acted as a catalyst for its penetration of other major developed markets during the past two years. As in the Bahamas, the reporting technology has been implemented across three separate entities – Bank of Canada, the Office of the Superintendent of Financial Institutions and the Canada Deposit Insurance Corporation.
Having been selected in 2011, Vizor began the two-year project in 2012 and the first phase of the system went live a month earlier than scheduled in 2013, with the second phase completing in 2014. Unlike the smaller Caribbean jurisdictions, the Canadian market represented a much bigger challenge. It required Vizor to fully or partially retire 13 legacy systems across the three agencies and to migrate 87 separate and unique types of data set, dating back to the 1960s.
"The Canadian project was a lot larger and more sophisticated than what we had done before, but the challenge is ultimately the same – how to source the data from market participants on time, and how to make sure it's correct, valid and usable. Usability is critical because the data has to be stored and made easily available to business intelligence and analytics," Crowley explains.
Given the Canadian financial market's reputation for sound and prudent regulation, the project put Vizor on the map, and by late 2014 it had been contracted by Sama for a major three-stage supervisory project, and by the Bank of England to support data collection and validation under Solvency II.
With a tight deadline prior to the implementation of the new European insurance regulation in January 2016, the Bank of England's Prudential Regulatory Authority needed a resilient reporting system based on an extensible business reporting language (XBRL) taxonomy that would scale up to support an increasing volume of reports from regulated insurance companies.
Vizor's flexible approach to XBRL, a widely used reporting language, has been a key differentiator, as incumbent providers often use only XBRL for data collection and fail to meet the more sophisticated requirements many entities now face, according to Crowley.
"The key distinction is that we treat XBRL as one of a number of possible ways of getting data into the system, but there are many additional processes and validation rules that we layer on top and cannot be expressed in XBRL. Vendors that sell mainly to commercial banks often rely on XBRL, but run into difficulties when they extend the same platform to the regulatory community," says Crowley.
The Sama project also brought its own unique challenges, not least that the Saudi central bank had been in dialogue with Vizor for several years before it finally contracted the vendor in December 2014. Sama went live with the first phase of a supervisory system, covering the insurance sector, just 15 weeks later, meeting an ambitious deadline set by the governor. The second phase, covering banking supervision, went live in March 2016, and Vizor is now working on the third phase, focusing on over-the-counter derivatives.
The transition from niche regulatory consultancy to internationally recognised technology provider has not been without some growing pains, Crowley acknowledges. As Vizor's growth has accelerated over the past few years and it has won multiple contracts over larger, more established providers, it has had to increase its resources very quickly.
With offices in Dublin, Dubai and Ottawa and a staff of only 75, it remains relatively lean for a company that serves clients in 30 countries around the world. Vizor has, however, made a string of additions to its senior management team over the past 18 months, most recently hiring Andrew Callanan as its first chief financial officer in October 2016.
"Growing our staff very quickly while continuing to deliver high-quality services to our clients has been the biggest challenge, but having a stronger senior management team in place allows us to concentrate on the business and delivering value to our customers," says Crowley.
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