Fitch Risk Management to acquire NetRisk and OpVantage

The acquisition, which both parties expect to be finalised this month, was described as “an excellent strategic fit” by OpVantage president and chief executive Daniel Mudge. “This gives us access to a wealth of information and research and more resources to expand our products,” said Mudge.

OpVantage was set up in April 2002 when professional services firm PricewaterhouseCoopers and NetRisk merged their op risk services, resulting in OpVar, an operational loss database. OpVar version 4.0 maps data to the Basel Committee’s quantitative impact study (QIS) loss event categories. Basel II, the new international bank capital Accord, will require banks to set aside capital for operational risks when it is introduced in late 2006, and OpVantage claims OpVar will help users meet the latest qualifying criteria.

The Basel guidelines are one of the main reasons that Fitch Risk Management was interested in acquiring OpVantage. “We think that with the Basel capital allocation guidelines OpVantage will be in demand,” said David Kelson, managing director of Fitch Risk Management. Kelson also said the deal will benefit customers. “We will be able to offer clients one-stop shopping now,” Kelson said.

The Basel Committee on Banking Supervision, the architect of Basel II, said earlier this week it would eliminate the floor on capital charges under the advanced approaches to measuring operational risk in the Basel II bank Accord. There were fears within the banking community that the floors would limit banks’ incentive to adopt the more advanced approach.

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