Feature/Risk management/Risk management
The disputed terrain of model risk scoring
There is no concord on how banks should police their model risk. But two Fed economists have an idea
Clearing houses in Asia to overhaul creaking margin models
Fears of Nasdaq-style failures spur rethink of margining practices at HKEx, JSCC, SGX
Machine learning hits explainability barrier
Banks hire AI industry experts in face of growing regulatory scrutiny
After Nasdaq, cracks appear in foundation of clearing
Default fund loss triggers debate on risk sharing, auction rules and ‘skin in the game’ at CCPs
European funds wary of stress-test ‘straitjacket’
As Esma finalises guidance, some fear a one-size-fits-all approach
China’s caution on compression stretches global banks’ risk limits
Systems lags and lack of capital pressure blamed for apathy on swaps compression
Do two sizes fit all? Banks aim to standardise vendor risk
Banks created TruSight and KY3P to vet supplier risk with standard questionnaires. Is it enough?
Cyber security begins a shift to the risk department
Normally the province of IT, cyber defence is increasingly seen as a critical part of operational risk
Lehman’s ghost: how three CCPs anchor models to crash
The Lehman crash still haunts the margin models of LCH, CME and Eurex, albeit in different ways
Libor reform threatens risk modelling under FRTB
Dearth of liquid products and historic data threatens banks with capital hit under new market risk rules
Stress tests expose climate risks in loan books
Efforts to quantify the risk of global warming are changing the way banks manage credit portfolios
Risktech start-ups struggle to clinch big-bank contracts
Light on cash, risk management fintechs face an extended gauntlet most won’t survive
Regulators bristle at slow progress on BCBS 239
Three out of 30 banks compliant with six months to go; talk of capital add-ons for laggards
OK, computer? Hurdles remain for machine learning in credit risk
Concerns over cost, applicability and oversight give pause to banks’ use of ML techniques in credit risk
Bank risk committees: desperately seeking risk managers
Most boards still lack career risk specialists despite tighter governance requirements
Climate risk joins ethics in driving lending decisions
Barclays, BNP Paribas and others are analysing risk of climate change-related losses
Lenders reveal struggles over IFRS 9 roll-out
Size of task caught some banks unawares, leading to botched home-grown systems or data problems
Banks explore new data techniques to tackle money laundering
Artificial intelligence in tandem with human analysis seen as effective for know-your-customer
Asia-Pacific banks grapple with conduct risk rules
Australia, Hong Kong regimes lead in developing conduct risk guidelines; Singapore lags behind
CME has chance to rule US rates after Nex deal
Market expects exchange to unite bond, repo, futures and swaps clearing – eroding grip of banks and DTCC
Fed risk rating system unifies stress testing and 3LOD
Some banks have qualms over potential downgrades and overlap between first and second lines
Global fragmentation looms in FRTB data pooling stand-off
Smaller banks unwilling to hand over localised trade information to data utilities
Banks grapple with IFRS 9 and CECL loan loss forecasting
Ambiguity in rules sets up potential clash between banks and auditors over “reasonable and supportable” projections
Quants needed: how finance can use power of quantum tech
New machines have big potential in AI, valuations and VAR, but tech giants like IBM need help from practitioners