LO 9.1.4.B

Learning Objective: Discuss the demand factors related to the search for higher profits, increased competition, and changes in the regulatory environment.

Review

• Demand factors

• Profitability: Improved risk management, potential for revenue gains, and cost reduction.
• Competition: “Arms race” with other financial institutions and firms.
• Regulation: prudential regulations, data reporting, best execution of trades, rules on anti-money laundering, and combating the financing of terrorism (AML/CFT).