Kevin Walkup: COVID-19 pandemic shows importance of data operations
03 April 2020 California
Image: Shutterstock
The COVID-19 pandemic has shown the importance of data operations and transparent communications in the financial services industry, according to Kevin Walkup, president and COO of Harmonate, a data services firm.
Walkup noted that lessons learned during the pandemic will help “fight panic exacerbated by conspiracy fears, particularly for asset managers that need trust almost more than anything else right now”.
He said that in light of the current pandemic, data is in “hot demand”, but if it’s poorly organised and shared inconsistently, “fear of the unknown is tipped too close to panic – the same thing can happen to asset managers”.
In the asset and wealth management industry, Walkup noted that providing clients and investors with dashboards has been avoided until recently.
He explained: “The fear has been if investors get too much information in real time, they are more likely to try to grab the steering wheel from the back seat and make shortsighted decisions. That is a valid fear, but opaque and limited information is worse.”
Walkup highlighted that private fund fragility includes not being able to quickly pin down where financing and funds are, and document it.
“Untangling complex mortgage vehicles, as the Great Recession taught, requires traceability and rewarding investors with an automated system that allows them to be in control and secure in their relationship with asset managers," he observed.
“This is not a market in which to rely on Excel and tailored macros that may propagate errors with cutting and pasting. Nor will allocators tolerate a lack of traceability while waiting days or weeks to understand their exposures.”
He added: “What data operations infrastructure is in place now, and how dependable it suddenly matters a lot more than it did a few weeks ago.”
Walkup noted that lessons learned during the pandemic will help “fight panic exacerbated by conspiracy fears, particularly for asset managers that need trust almost more than anything else right now”.
He said that in light of the current pandemic, data is in “hot demand”, but if it’s poorly organised and shared inconsistently, “fear of the unknown is tipped too close to panic – the same thing can happen to asset managers”.
In the asset and wealth management industry, Walkup noted that providing clients and investors with dashboards has been avoided until recently.
He explained: “The fear has been if investors get too much information in real time, they are more likely to try to grab the steering wheel from the back seat and make shortsighted decisions. That is a valid fear, but opaque and limited information is worse.”
Walkup highlighted that private fund fragility includes not being able to quickly pin down where financing and funds are, and document it.
“Untangling complex mortgage vehicles, as the Great Recession taught, requires traceability and rewarding investors with an automated system that allows them to be in control and secure in their relationship with asset managers," he observed.
“This is not a market in which to rely on Excel and tailored macros that may propagate errors with cutting and pasting. Nor will allocators tolerate a lack of traceability while waiting days or weeks to understand their exposures.”
He added: “What data operations infrastructure is in place now, and how dependable it suddenly matters a lot more than it did a few weeks ago.”
NO FEE, NO RISK
100% ON RETURNS If you invest in only one asset servicing news source this year, make sure it is your free subscription to Asset Servicing Times
100% ON RETURNS If you invest in only one asset servicing news source this year, make sure it is your free subscription to Asset Servicing Times
