ABSTRACT

In today’s volatile financial environment, institutions face increasing pressure to conduct real-time stress testing that ensures resilience and regulatory compliance. As financial markets become more complex and data-intensive, traditional computing infrastructures often struggle to deliver timely insights required for proactive risk management. This study explores the transformative role of hybrid cloud strategies in enhancing the capacity and agility of financial stress testing systems. By integrating on-premises resources with public cloud services, hybrid cloud architectures offer scalability, flexibility, and cost-efficiency, enabling institutions to meet fluctuating computational demands without compromising data security or performance. The deployment of distributed analytical engines within this architecture facilitates rapid data processing and seamless integration of diverse financial datasets, while supporting a responsive analytical framework. Additionally, parallelized Monte Carlo simulations—optimized within hybrid environments significantly improve the precision and speed of forecasting under various stress scenarios. The findings underscore the strategic advantages of hybrid cloud adoption in financial analytics, particularly in addressing operational bottlenecks, improving model performance, and supporting regulatory transparency. This paper highlights how the synergy of hybrid computing and advanced simulation techniques redefines real-time risk assessment, offering financial institutions a forward-looking approach to stress testing in an increasingly digital and uncertain financial landscape.