The likelihood of a “high-impact event” to the global financial system has
increased over the last six months, according to findings released by The Depository
Trust & Clearing Corporation (DTCC) in its Q3 2015 Systemic Risk Barometer
The DTCC Systemic
Risk Barometer Survey found that 45% of respondents believe there is an
increased probability for a “high-impact event” in the next 12 months. The previous survey conducted in Q1
2015 found that just
29% were of the same opinion.
The Systemic Risk Barometer Survey
is a semi-annual pulse check that monitors emerging trends on risks that may
impact the safety and resiliency of the global financial system. DTCC’s primary
role in financial services is to lessen risk and ensure financial stability. Among
the questions, the survey provided a list of 20 systemic risks, which could all
be considered potential high-impact events.
told an even more interesting story for risk managers,” said Michael Leibrock,
Managing Director and Chief Systemic Risk Officer at DTCC. “We found that 61
percent of risk managers believe that the probability of a high impact event
has increased in the last six months—much higher than the 45 percent figure we
saw from all respondents.”
Risk Barometer was sent out to banks, brokerage firms, clearing firms, money
managers and other stakeholders in the financial services industry. About 400
financial professionals responded to the survey sent out in September,
including risk managers and others in legal, compliance, technology and
operations. The survey also asked respondents to rank their top five risk
concerns in order of importance.
Cyber Concerns Remain Strong
main finding is that cyber risk remains the chief concern among financial
industry professionals—and has been for the last two surveys. Cyber risk
weighed in as the top risk, with 70% of the respondents ranking it in their
list of top five concerns, while 37% listed it as their No. 1 concern
“Given the number
of cyber attacks in 2015 that garnered headlines, it comes as no surprise that
cyber security remains a top concern throughout the industry,” said Stephen
Scharf, Managing Director and Chief Security Officer at DTCC. “Comprehensive
security programs will need to continually evolve as they devote more resources
to an ever-changing systemic risk landscape.”
Related: DTCC Cyber Security White Paper
Top Risk Concerns
and geopolitical risks remained the top two risks from Q1 to Q3, respectively.
Half the respondents, 50%, placed geopolitical risk in their list of top five
concerns. The impact of new regulations also held steady at number three, with
41% citing it as a top five concern.
around an economic slowdown outside the E.U./U.S. jumped from 22% in Q1 to 33%
in Q3. As a result, this risk now ranks fourth, up from eleventh place six
before the survey was sent out, fears of a China slowdown roiled markets in
August,” explained DTCC’s Leibrock. “It makes sense that this issue made the
list of top five concerns.”
to the risks mentioned above, concerns about decreasing liquidity rose
significantly, from 24% six months ago to 30% in the new survey.