The shock of the interaction


The financial crisis has forced a rethink on how banks and regulators approach enterprise risk management. For many institutions, different risk types have historically been measured and managed separately across positions, then aggregated together to come up with a single, enterprise-wide view of risk. However, the recent malaise in financial markets has shown that the distinctions between market risk and credit risk are a lot more blurred than many people had thought. In fact, the two risk

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