Risk Management
Latest Risk Management
Banks split over AI risk management
Model teams hold the reins, but some argue AI is an enterprise risk
New EBA taxonomy could help integrate emerging op risks
Extra loss flags will allow banks to track transversal risks like geopolitics and AI, say experts
Collateral velocity is disappearing behind a digital curtain
Dealers may welcome digital-era rewiring to free up collateral movement, but tokenisation will obscure metrics
Third of banks run ALM with five or fewer staff
Across 46 firms, asset-liability management is usually housed in treasury, but formal remits and staffing allocations differ sharply
Risk managers question US reach of Dora third-party list
Some EU subsidiaries included, but regulator control over cloud providers could still be limited
Could one-off loan losses at US regional banks become systemic?
Investors bet Zions, Western Alliance are isolated problems, but credit risk managers are nervous
Clearing
FICC to launch new default fund before UST repo clearing mandate
Clearing members expected to welcome FICC’s plans to separate loss mutualisation from margin
Industry groups call on EC to delay foreign CCP reporting
Trade bodies seek to prevent late-running rules causing duplicated implementation projects
FICC takes record bite from MMF repo investments
Funds shift cash from the Fed’s ON RRP as cleared repos hit $1.11trn
How US hedge funds won big on permission to clear at JSCC
But CFTC no-action letter won’t allow netting of Japanese trades with those cleared at US FCMs
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BofA Securities defies year-end pullback with record F&O customer funds
December growth contrasts with broader FCM retrenchment from October peak
XVAs
Most banks stick to tried-and-trusted XVA models
Black Scholes- and Heath-Jarrow-Morton-based approaches dominate, with some exploring Copulas for wrong-way risk, post-Archegos
Half of European banks already embed FRTB into XVA pricing
US and rest of world lag Europe in incorporation of Basel capital rules into XVA calculations, Risk Benchmarking analysis shows
Dealers favour central XVA desks, but splits remain on funding
Most banks run a single desk within the front office, but more than half share responsibility for its funding needs with treasury
XVA desks may be standard – their tech and mandates aren’t
A decade into centralised management of XVAs, Risk Benchmarking data finds divergent approaches to pricing, methodologies and tech stacks
CME faces battle for clients after Treasuries clearing approval
Some members not ready to commit to 2026 start date; rival FICC enhances services
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AI and the next era of Apac compliance
Transforming the trade lifecycle with pricing and reference data in the cloud
Institutional priorities in multi-asset investing
LSEG streamlines post-trade efficiency across cleared and uncleared markets
Bringing trading-desk data into derivatives pricing models
