These are the jobs regulation is spurring in financial technology

A lot has been written about the need of investment banks and other financial institutions to divert technology budgets away from front office projects and towards the IT challenges presented by the raft of regulation hitting the sector.

But if the jobs are being created, what types of people are being recruited?

1. Dodd Frank: The requirement for centralised clearing and more onerous reporting requirements around OTC derivatives is prompting many banks to invest in clearing and settlements systems. Recruiters suggest that Barclays, Lloyds Wholesale Markets and HSBC are all hiring in this area.

“Banks are looking at their existing processes and the downstream effects that centralised clearing will have on their systems,” says Ben Cowan, director at recruiters Astbury Marsden. “There’s a big push for developers and business analysts in this area.”

2. Solvency II: The raft of jobs being created as a result of Solvency II regulation, which requires insurance firms to hold more capital in order to reduce the risk of insolvency, has largely focused on the actuarial space. However, there are big data challenges presented by the regulation, particularly when you consider the prevalence of creaking legacy systems that still dog insurers.

“Insurance companies are investing in improving the quality of their data, and as a result are taking on data analysts and data warehousing specialists, who are at a premium currently,” says Chris Potter, partner risk assurance at PWC.

3. Basel III: The primary focus for banks’ IT recruitment needs for Basel III has been taking on business analysts to assess what exactly needs to be done to their systems in order to meet the requirements.

“Development roles are still a little way off, but there’s steady stream of business analyst positions around Basel III,” says Matthew Percy, senior consultant at Hudson.

However, there’s something of a “land grab” for technologists who have experience of creating counterparty value adjustment (CVA) systems, says Andrew Keene, director of IT in finance recruiters Thomson Keene.

“Building a CVA system is complex, and knowledge is still comparatively rare in the City, so there’s active targeting of people with experience of this in competitor organisations,” he says.

4. Know Your Customer (KYC)/anti-money laundering: Banks and financial institutions are subject to more onerous due diligence about gaining information about who they do business with. This involves investment in analytics software algorithms to capture more customer data.

“There’s a raft of technology projects underway in most financial institutions related to KYC legislation –policy, procedure and controls - and this is creating a demand for technologists with the hybrid skills of business analysis and a thorough understanding of the regulatory environment,” says PJ Di Giammarino, founder and CEO of regulatory IT consultancy JWG-IT.

5. Jobs within the regulators: The likes the Bank of England and the Financial Services Authority have all been investing in their technology divisions as they’ve expanded their scope and started to bear their teeth more, suggests Di Giammarino. “I’m seeing bigger and bigger IT teams within these organisations all the time,” he says.