Timely KYC competitive advantage for European investment bank

PwC’s Financial Crime Managed Services enables a faster turnaround for complex regulatory checks on new customers for the bank’s fixed income and currencies organisation.

Banks have a key role to play in preventing criminals from accessing the financial system, and regulators worldwide expect rigorous ‘know your customer’ (KYC) or customer due diligence processes to be followed every time a new client is brought on board. European national regulators have particularly strict requirements, and for investment banks in the region, being able to carry out detailed checks faster than their rivals can play a pivotal role in winning new business.

In 2023, a large European investment bank agreed a managed service contract with PwC’s financial crime team to support their in-house KYC and anti-money laundering (AML) experts on quick-turnaround KYC work. The investment bank’s Fixed income and Currencies organisation wanted to be able to call on additional expertise at short notice, when they need to be able to offer a timely KYC process to new clients.

PwC's Financial Crime Managed Services team had an established relationship with the bank, after working together over several years on a KYC remediation programme.

Complex KYC reviews for investment and corporate banking do still require a large degree of manual processing, identifying and validating new clients and all the related parties are who they say they are and that their income is generated legitimately and not the proceeds of crime.

The managed service in this case is carried out by PwC’s Financial Crime Managed Service teams in Bangalore and Belfast, who bring many years of in-depth AML and KYC expertise in carrying out the checks on a large spectrum of client entities from global multinational corporations, to complex special purpose vehicles (SPVs) to the less complex individual entities. That allows them to work collaboratively with the bank's own front, middle and back-office teams and flag potential risks while ensuring as an efficient an onboarding process for the bank's client as possible. 
 
“Our teams have the challenging role of having to ensure all the required financial crime risks are understood and shared for the bank to approve - we don't cut corners,” said Howells. “Our role is to assist in confirmation that no bank clients create risk above and beyond the bank’s risk appetite.”

“If there is an onboarding deadline for a funding deal for example, we will do everything we can to complete the required KYC reviews ahead of that. That might be making multiple resources working different elements of the client review, multiple shift patterns or a combination thereof,” he added. If you give us a challenge, we will figure out a way through the process and get it done.”

No place for a cookie-cutter approach  

As the KYC assessments for the bank’s large corporate clients often throw up questions for PwC’s team, maintaining open communication with the bank is essential - particularly given the time-sensitive nature of the cases they are working on. To answer these questions, PwC’s teams benefit from being part of the firm’s wider financial crime practice, said Howells. 

“If there is something ambiguous or different or new, and it doesn’t quite fit in the process or policy, we’ve got access to the advisory part of the business,” he said. “That allows our teams to suggest what needs to be done, with confidence and credibility that the regulator will be happy with the proposal.”