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A wrong-way bet

China Aviation Oil (CAO) revealed in late November that it had lost $550 million through trading oil derivatives – but not before its Chinese parent sold $108 million in CAO shares. By Nick Sawyer, with additional reporting by Jill Wong

Setting a timetable

Regulators in Australia and Japan are the latest to set deadlines for their banks to comply with Basel II, and both differ slightly from the Basel Committee’s schedule. Nick Sawyer reports

The importance of ALM

The crossfire between the International Accounting Standards Board and the European Commission seems to have left corporates bewildered about the implications of IAS 39. Risk talks to leading advisory groups and corporates about the challenges ahead, and…

Citibank cut out

The suspension of Citibank’s private banking business by the Financial Services Agency in September has brought to light a catalogue of internal control and governance failures within the bank’s Japanese operations. And with Citi now cut out of the…

Mind your behaviour

Hedge fund managers are becoming interested in behavioural theory, anincreasingly influential branch of economics that describes the role of intuitivebias in investment decision-making. According to one finance professor,behaviouralism provides valuable…

The game of life

UK life insurers have faced a new regulatory regime in the aftermath of the guaranteed annuity options disaster, which has led them to rethink their use of derivatives. Nicholas Dunbar talks to four leading life companies

Reducing risk through insurance

In this article, Silke Brandts describes a general algorithm for quantifying the risk-mitigating impact of operational risk insurance. She then presents a simple haircut approach to incorporate residual risks inherent in the insurance contracts into the…

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