Newsletters
Confluentia endeavours to supply our clients
with periodic updates and insights relating
to project practices and issues, the market,
and financial technology.
Confluentia - Market & Project
Highlights
2008 was a year in which only landscape-changing events could expect to make it to a "highlight" list. In the year book-ended by Jerome Kerviel's EUR 4.9 billion losses at Soc Gen, and Bernie Madoff's unprecedented USD 50 billion fraud, here are some such events:
- The nationalization of Northern Rock, Fannie Mae and Freddie Mac
- The partial nationalization of Lloyds, HBOS (Halifax Bank of Scotland) and RBS (Royal Bank
of Scotland) - The shuttering under various guises of Bear, Lehman, Wachovia, and Washington Mutual
- The extinction of the US investment bank, as Goldman Sachs and Morgan Stanley became commer cial banks to ensure access to liquidity from the US Federal Reserve
- The weekend buyout of Merrill Lynch by Bank of America
- The USD 85 billion lifeline thrown to AIG (American International Group)
Other statistics:
- USD 320 billion was withdrawn from mutual funds
- Oil broke $100 per barrel in January 2008, climbed to $147 in July, and dropped again to the
mid-30s in December, wreaking havoc with the carbon markets - The US's FDIC (Federal Deposit Insurance Corporation) problem bank list grew from 90 at the end of
Q1 2008 to 252 by the end of the year, with 25 banks shut down during the year (and
a further 14 already shut to date in 2009) - The Dow Jones Industrial Average fell 18.2% in the week of October 6 - its worst ever one-week decline
- London's FTSE 100 lost 21.1% in the same week as investors scrambled to move into cash
- The financial sector incurred more than 113,000 job losses.
2008 Summary
Amid all of that, in 2008 market participants were squarely focused on keeping the lights on,
rather than diving into large-scale strategic technology overhauls. The focus was on...
Looking forward - preventative measures
Although the landscape continues to change as the crisis unravels, at a certain point we will
be through it, getting familiar with the new and remaining players, and attempting to look ahead.
At that point, what measures can be taken to prevent a repeat?
Project work
Large-scale strategic IT projects were few and far between in 2008. Smaller-scale, targeted initiatives continue, however, along with essential projects to support acquisitions. Below is a short summary
of the types of initiatives we are likely to see.
Wrap up
Confluentia anticipates a challenging year for most participants as they adjust to new realities
and consolidate their new business models and any bolt-ons.