Compliance costs are eating up more and more net income, growing from 2.83 percent of net income in 2002 to 3.69 percent in 2006.
Much has been said about the rising cost of compliance, and new research reveals that the concern is merited. According to New York-based Deloitte & Touche's Deloitte Center for Banking Solutions, which surveyed chief compliance officers, chief risk officers and other senior executives at 20 of the top 50 financial institutions in the United States, compliance spending is growing faster than respondents' net income.
Compliance costs are eating up more and more of firms' net income, growing from 2.83 percent of net income in 2002 to 3.69 percent in 2006, Deloitte reports. Since there are no tangible ways to measure the cost savings or risk avoidance that regulation provides for institutions, this increase in spending is a tough pill to swallow, the firm adds.
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