Financial institutions depend on high-quality data for everything from client servicing to risk assessment. This reliance is especially critical in managing risk, including liquidity, market, and credit risk, where precise, real-time insights allow institutions to track available funds, predict cash flows, and ensure they can meet both current obligations and future demands. However, achieving this level of speed and precision is a persistent challenge for much of the industry.

Many institutions continue to operate on legacy technology platforms not designed to handle the demands of today’s real-time data environments. These outdated systems make it difficult to gain a unified view of risk, integrate data effectively, or respond quickly to market changes. Modernizing these platforms requires more than just a technological upgrade—it demands a fundamental rethinking of how data is unified, governed, and processed across the organization.

As market volatility and trading velocity continue to soar, the need for real-time, dynamic risk management has never been greater. Legacy, purpose-built risk applications are no longer sufficient for institutions that require up-to-the-minute insights to manage positions, hedge exposures, and proactively mitigate risks. By adopting modern risk management systems, financial institutions can unlock new efficiencies, reduce operational complexity, and strengthen their resilience in an increasingly dynamic and regulated financial landscape.

Championing change in a highly regulated industry  

Financial institutions depend on a complex network of interconnected players and systems that produce vast amounts of data in different formats and at varying speeds. Externally, data flows from trading platforms, clearinghouses, and market participants, while internally, fragmented systems and siloed infrastructures often limit the ability to integrate data effectively. These inefficiencies not only delay critical risk calculations but also expose firms to greater regulatory and reputational liabilities.

While some leading institutions have successfully transitioned to cloud-based, real-time systems, a significant portion of the industry still relies on decades-old platforms for critical functions like transaction clearing and risk calculations. Resource constraints, driven by the demands of regulatory reviews, audits, and compliance requirements, leave little bandwidth for large-scale modernization efforts. Years of custom development tailored to specific business and regulatory needs have created significant technical debt, making migration both resource-intensive and overwhelming. These factors, coupled with the need to carefully phase changes to avoid operational disruptions, create high barriers to modernization. 

In the face of these adversities, modernization offers the promise of improved efficiency, cost reduction, and the ability to meet growing market and regulatory expectations for real-time capabilities—benefits that some institutions are already reaping.

Building resilient risk systems with the Snowflake AI Data Cloud 

Modern data platforms like Snowflake are transforming the industry by enabling real-time data processing, unifying fragmented systems, and providing the scalability needed to adapt to evolving market demands. By centralizing data into a secure, governed environment, Snowflake enables faster, more accurate risk calculations and real-time insights—essential in today’s fast-paced market. With its ability to ensure transparency, traceability, and regulatory compliance, Snowflake helps institutions reduce complexity and costs, improve operational efficiency, and build trust. These capabilities empower teams to shift focus from manual processes to strategic decision-making, creating a strong foundation for tackling today’s challenges and adapting to future demands.

An impactful example of Snowflake's transformative role in finance is the story of one systemically important financial market utility (SIMFU). Leveraging the Snowflake AI Data Cloud and Amazon Web Services (AWS), this organization revolutionized its risk management operations, enabling its liquidity risk team to focus on strategic, value-driven initiatives while building a foundation for organization-wide modernization.

Burdened by legacy technology, the institution faced all too familiar challenges in meeting stringent regulatory requirements and handling ad hoc data and reporting demands. To modernize in such a highly regulated, risk-averse environment, the organization teamed up with Slalom, a trusted partner since 2017, to develop a strategy and roadmap for transitioning to a modern cloud-based platform., Amazon Web Services. 

Using Slalom's modernization methodology, the team defined a clear vision and multiyear roadmap aligned with IT and business objectives to ensure cohesive progress. The solution established a robust technical foundation using Snowflake’s advanced tools—such as Snowpark for in-database computations, Horizon for data quality measurement, and Snowpark Container Services for custom user experiences.

Blueprint for success

Modernizing risk systems often begins with a specific pain point, such as liquidity risk, but the benefits extend far beyond, serving as a foundation for unified processes across finance, treasury, and risk disciplines. When approached strategically, addressing these specific risks creates a ripple effect—enhancing consistency, simplifying complexity, and aligning quantitative practices across the business.

For financial institutions still reliant on legacy systems that struggle to keep pace with evolving regulatory demands and dynamic market conditions, the SIMFU success story provides a blueprint, demonstrating the power of strategic, incremental change. By breaking down the modernization journey into clear, actionable steps, organizations can achieve meaningful progress without disrupting critical operations. This measured approach delivers immediate value while simultaneously building the foundation for broader transformation. The result is a pragmatic pathway that allows financial institutions to modernize at a sustainable pace while maintaining operational stability. Key elements of this approach include:

1. Identify key pain points and prioritize for ROI: Start by pinpointing the areas causing the greatest inefficiencies or challenges. Prioritize solutions that deliver the most significant value quickly to generate early wins, build momentum, and demonstrate measurable return on investment (ROI).

2. Evaluate technology gaps and solve with innovative solutions: Assess legacy systems, processes, and workflows to identify inefficiencies. Partner with trusted technology providers to implement leading-edge solutions that address immediate needs while positioning the organization for sustainable, long-term growth.

3. Ensure robust governance of the modernization program: Establish clear governance frameworks to oversee the execution of modernization efforts. Focus on aligning decisions with strategic priorities, maintaining accountability, and ensuring solutions are implemented effectively across targeted areas like liquidity risk.

4. Develop scalable frameworks for broader application: Once a solution is successfully implemented, build reusable frameworks and processes to accelerate future efforts. By standardizing technology choices and proving patterns of success, you can streamline modernization across additional areas, such as other types of risk management, saving time and resources.

5. Adopt a holistic approach to people, processes, and technology: Align tools and technologies with user needs and organizational objectives. Consider the broader ecosystem—encompassing people, workflows, and cultural readiness—to ensure successful adoption and long-term transformation.

By adopting a multi-step, customer-centric approach focused on iterative value delivery and scalability, organizations can modernize efficiently, achieve early results, and establish a foundation for long-term innovation. Slalom’s Risk Platform Accelerator leverages this methodology to deliver fast, cost-effective, event-driven risk applications on Snowflake, with capabilities for system health tracking and scalability across market, credit, liquidity, and operational risks.

Modernize with confidence

Whether it's retail banking, investment management, or capital markets, reliable data from a single source saves time, reduces costs, and enables better decision-making. Centralizing financial data into secure, unified systems ensures accuracy, timeliness, and traceability, empowering institutions to confidently assess risks, manage liquidity, and optimize transactions. The shift from fragmented, purpose-built tools to integrated data platforms creates operational efficiencies, enhances governance, and delivers scalable solutions. By addressing specific challenges, such as liquidity risk, financial institutions set themselves up to unlock broader benefits—streamlined processes, tighter controls, and stronger business outcomes—empowering them to make precise and timely decisions with confidence.