April 10, 2020

Risk Management In Investment Banking & Capital Markets: The Benefits of a CRM

COVID-19 has caused a significant dislocation in the market, impacting risk management in investment banking, capital markets and asset management firms. The main driving force behind these changes is that the industry is experiencing an unprecedented increase in the need for technology and work-from-home requirements.

This new normal is driving financial services professionals to rapidly adopt technology to manage their client interactions via mobile applications, secure cloud solutions, and video conferencing to remain productive and collaborate with their colleagues.

COVID’s Impact on Risk Management In Investment Banking & Capital Markets
It wasn’t so long ago that working from home – or any other remote location – was the exception rather than the norm. Capital markets participants require significant information sources, technology systems and real-time communication with colleagues to do their jobs.

We have observed a significant uptick in the adoption of CRM and the sharing of information to bridge the gap of communication between co-workers who, under normal circumstances, could have simply spoken to each other in person. In this time of high market volatility, asset managers depend on their engagement with their capital markets counterparts and the companies they invest in, but are seeing their routines disrupted and their operating model tested.

Client Engagement

A critical element removed from the process of client engagement is in-person interactions. These include face-to-face meetings with corporate clients, all-day conferences, roadshows and field trips. Capital markets and investment professionals working from home need to find alternative ways to connect with each other and their clients. With effective technology and training, sell-side professionals can continue to deliver the essential value their clients require during this time of crisis and investment managers can continue to make knowledgeable investment decisions.

Corporate Access

The shift to virtual corporate access meetings from face-to-face meetings with investors has occurred swiftly. This is a busy time of year for companies and investors to get together at conferences, and overnight they have shifted to using video conference technologies via mobile and desktop. These meetings are more than a nice-to-have option and are viewed as an essential service aligned to the proper due diligence and oversight of a fund manager. We have observed a growing need for these events to be managed more systematically using tools which allow collaboration, tracking and web conferencing. Last month, we shared our compatibility of Tier1’s event software and how we are helping buy-side and sell-side clients alike adapt to their evolving needs.

Equity Research

The increased demand for advice and research content has also spiked dramatically. How you adapt to your client and staff needs during times like this can really define you and your organization. Research reports are being issued much more frequently and rapidly due to the regularity at which news in the market is impacting the value of the companies covered.

We are also seeing an increase in the number of direct conversations and interactions which need to be tracked between the sell side and buy side. For bankers, while deal flow is understandably down, meetings are up as the need for advice and consultation by corporate and financial sponsor clients is greater than ever. The quality of these interactions is highly valuable, and those leveraging their CRM technology can and will be able to fully monetize them and be rewarded for their efforts.

Advancements In Technology

Market participants need the fastest, latest and most advanced cloud, mobile, and telephony technology available; solutions designed to be accessible to all users working remotely, such as the software solutions that Tier1 provides.

Compliance and security are features that can’t be overlooked in capital markets, as an increase in use of digital products means an added importance of risk management in investment banking and capital markets daily operations.

It’s a highly regulated industry and any solution firms deploy needs to be able to accommodate these sophisticated requirements including the ability to support employees who work from home or away from the office during times like this. These financial entities need technology with a purpose-built security model for the buy side and sell side to maintain compliance. They also need the tools that can properly configure restrictions and entitlements, thereby reducing business risk and potentially avoid costly mistakes.

The challenges are enormous, but cloud-based digital strategies are enabling secure and frictionless client and employee engagement. This allows financial institutions that provide essential services to enact disaster recovery plans without productivity taking a hit. Whether it’s maintaining workforce cohesion and productivity or continued compliance and collaboration across the business, it takes cutting-edge technology and planning to maintain optimal client coverage.

Software Solutions for a Changing Industry

So how can firms ensure uninterrupted service and effective management of relationship risk in a remote and challenging working environment? Regardless of location, market participants need access to mission-critical tools, connectivity, and workflows (across a range of platforms) that only cloud-based solutions can deliver.

Managing relationships – and creating new ones – requires premium and purpose-built, cloud-based CRM systems with 24/7 global access. As outlined by Tier1 Sales Engineer Brian Bock, a former institutional equities salesman, a strong and reliable CRM system allows employees who are dispersed around the world or working from home to continue building a strong engagement with their clients and unlock efficiency within their daily workflows. This allows users to monetize value in real time, and ultimately provide better and more timely service to customers and reduce investment banking and capital market risk.

In these uncertain times, the well-being of family, friends and colleagues is of the utmost importance. But despite the disruption to our lives, managers can have greater confidence in client relationships and business continuity if the proper relationship management solutions are in place.


Contact us today to learn more about how Tier1’s software products can help streamline client interaction and risk management operations in investment banking and capital markets.