2  BIS central bankers’ speeches  2. Resources: On the resource front, we are seeing firms struggle to secure and retain sufficient expertise in some areas, with firms competing for the talent needed to implement the new standards. Firms need to get better at planning in advance, ensuring their recruiting efforts are providing a steady stream of qualified candidates, and looking for opportunities to move people around within the organization, particularly between the front office and control functions, for more well-rounded professions. This is likely to mean more aggressive, creative and targeted searches and a commitment to ongoing training. As the landscape and regulatory requirements change, firms will need to find the right balance between hiring new talent with specific expertise and training current staff to keep them up to speed and capitalize on institutional knowledge. 3. Regional coordination: Cross-functional regional coordination across business areas is necessary, as is coordination across regulatory change programs (EPS, Volcker, Derivatives, RRP, etc.). In addition, FBOs will have to manage several regulatory layers of risk governance including meeting the demands of their home regulator and various host country regulators. 4. Capital Planning, Liquidity and Stress Testing: As firms become more accustomed to – and experienced with – the range of stress testing and capital requirements, there should be greater appreciation for the expectations around governance, quality of modelling, quality and granularity of data, and the level of coordination needed with the head office.
The work of the Basel Committee on capital and liquidity standards, as well as the work of the Financial Stability Board (FSB) on cross-border resolution, are but a few examples of the hard work that global bodies have been undertaking to address the weaknesses identified through the crisis. At the same time, national authorities have been working hard both to implement the agreedupon global fixes, but also to develop and execute appropriate remedies for problems identified at the national (or local) level. Locally, while appreciating the need to address the  BIS central bankers’ speeches  1  crisis on a global scale, many countries saw the need to be in a better position to safeguard their own. The bottom line, in fact, was: the crisis was global, but the impact was felt locally. Global in life; local in death, as the saying goes. So, while authorities have endeavored to develop and implement common global rules across a wide range of issues, many national authorities have simultaneously moved to develop and implement national standards – that may conflict with or appear at odds with a barrier-free and harmonized financial system that allows the free flow of capital and competition across the globe. National rules that require local capital and local liquidity are two examples of standards that may present challenges to the efficient and effective operations of global firms. It will be important for firms to be in a position to meet both sets of requirements.