NatWest Markets: Navigating fast-changing markets and regulations in real time on Google Cloud

Founded in 2016 as the investment arm of Natwest Group, NatWest Markets helps its corporate and institutional customers manage their financial risks and achieve financial goals while navigating changing markets and regulation. Today, beyond providing products and solutions centered across currencies, rates, and financing, the company's mission is to actively support customers in their transition to achieving broader environmental and societal goals.

"We measure our success by the results we deliver for our customers," says Jeremy Arnold, Chief Risk Officer, NatWest Markets. "But to provide excellent customer service and fast execution, we need to anticipate their needs with the right people and the right technology in place."

Originally, the bank's Risk applications were set up on a high-performance computing grid managed by a central technology team at NatWest Group. But in 2019, faced with the need to process larger volumes of data at speed and on ageing servers, NatWest Markets decided to migrate Risk platforms to the cloud.

"As the volume of data we need to process continues to increase, the regulators become more demanding and customers expect faster services, it became clear that it wasn't enough for us to speed up processes and carry on as usual. We instead needed to transform the way we do things," explains Chris Conway, Head of Risk and Finance Technology, NatWest Markets. Deciding to migrate to the cloud instead of refreshing and buying new servers, Conway and his team used the momentum to research tools that could be integrated with a serverless infrastructure to help the bank to adapt long-term, selecting Google Cloud Platform to power this digital transformation.

"Google Cloud is the ideal solution for us because it provides on-demand scalability, analytics capabilities that broaden the possibilities of what we can do for our customers, and automated services that free up our team from managing infrastructure to focus on our customers instead," Conway explains. "We had clear, but challenging objectives, and with our partnership with Google Cloud we were able to achieve them."

Helping colleagues and customers to realize their potential quickly

Speed is key in financial markets, especially at a time when global systems are being impacted by market volatility. News about price fluctuations and interest rates, for example, can all affect the risk appetite of a company within seconds. NatWest Markets knows the importance of being able to support its customers by collecting signals from a diverse set of data points and interpreting them to enable timely business decisions. So, when laying out its cloud migration plan, moving data processing workloads to BigQuery to turn data into insights quickly and cost-effectively was a priority.

"Traditional data warehouses aren't designed to handle today's financial data growth, run advanced analytics, or scale quickly and cost-effectively. As a result, many financial institutions are burdened by operational complexity and are unable to innovate," says Conway. "As a modern and truly serverless data warehouse, BigQuery addresses our current analytics demands with blazingly-fast, real-time, predictive insights while scaling as our data needs grow."

To build cloud capabilities within the company, NatWest Markets invested in training 1,100 employees on Google Cloud Platform throughout 2021, with almost 100 of them becoming Google Cloud certified. "We speak with the Google Cloud team continuously as the efforts in our progression have to come from both sides. It means a lot for us to be able to get the support and training to empower our engineers to think differently, use tools they enjoy, and play an active role in driving our cloud migration forward."

High performance computing for risk simulation and regulatory reporting

With its migration journey well underway, NatWest Markets has already seen a significant reduction in the overall time to complete business-critical pricing and risk management activities. "By simply migrating from on-premise to BigQuery, we've already noticed a 60% improvement in compute time for overnight batch processing of risk simulations and calculations," Conway explains. NatWest Markets is using multiple Google Cloud products to achieve these outcomes including Compute Engine, Google Kubernetes Engine, Cloud SQL, Cloud Storage, BigQuery and Dataproc.

Meanwhile, compliance with regulatory requirements and effectively managing regulatory relationships remains critical to the ongoing success of NatWest Markets, so the company is also leveraging the ability to streamline regulatory reporting with unified data on BigQuery.

Next, NatWest Markets aims to build artificial intelligence and machine learning capabilities to detect financial risks for customers before they arise. "Our goal is to have all risk modelling, surveillance, and supervision powered by machine learning on Google Cloud from 2022 onwards, where we can better connect the dots from different data sources," says Conway.

NatWest Markets is also looking at how Google Kubernetes Engine can help improve its performance by containerizing application components as it transitions from a monolithic to a microservices architecture. "We aim to speed up our release cycles from 12 months to 2 weeks for the XVA (valuation adjustments) desks, and we're just touching the surface of what we're able to do with Google Cloud," says Conway.

Helping address the climate crisis

Besides its focus on customer services and the optimal use of technology, NatWest Markets is also considering how to make its own operations 'Climate Positive' by 2025. Aligned with the purpose goals of the broader NatWest Group, the Group aims to use 100% renewable electricity in its direct global operations by 2025, and to see 40% improvement in energy productivity by 2025 from a 2015 baseline.

The company is working to help others accelerate the speed of transition to a low-carbon economy, too. "We're talking to all our clients about their transition plans towards a low-carbon way of conducting business, and we have been clear as a group that we have no interest in partnering with companies that do not aim to take responsibility for their own carbon footprint," says Arnold. "With that in mind, the fact that Google Cloud is carbon-neutral and committed to running on carbon-free energy by 2030 is part of the reason why we've strengthened our bonds in the past 18 months, and we look forward to a long and prosperous partnership."