Two-thirds of financial services companies have cited poor quality information as the biggest concern in complying with forthcoming industry regulations.

Only 17 per cent of banks are confident of meeting the new Basel II accord on credit risk regulation, which has multimillion pound implications for their IT systems, according to research by software vendor SAS.

Basel II replaces a 1988 agreement which was set up to mitigate lending risks. The new accord, due to take effect in 2006, will consider more factors than the existing approach.

Three years' worth of historical data will be needed by 2003 to satisfy the requirements.

Kevin Ryan, of the Associate Prudential Standards Division at the Financial Services Authority, hopes that further research will help the industry to prepare for the accord, and provide clearer definitions of the required data.

But Barclays is confident that it will meet the deadline, according to Adrian O'Connor-Mitchell, director of group credit risk for Barclays Retail.

"The benefits of this are enormous," he said. "There are huge opportunities to improve the way we manage our processes, policies and management information framework."