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Latest on 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
Fed’s Brainard wary of black box AI models in consumer credit
Speech raises explainability issue; says existing model risk guidelines are “a good place to start” in regulating AI
US G-Sibs cut $36bn of HQLA
Wells Fargo clears out $27 billion of HQLA in first nine months of 2017 alone
Latest
Quotes
Maybe 10–15 years from now, a case can be made that Lehman is no longer that relevant; but for the foreseeable future, we didn’t want to be in the predicament of those scenarios rolling off periodically
Udesh Jha, CME Clearing
As risk people, we also have to be technologists. We’re not going to be experts, but we need to talk the talk. Otherwise, IT is going to laugh at us
Head of information security at the US subsidiary of a European bank
Asking banks to participate in additional compression runs is like ringing them up and saying, ‘Would you like a kick in the face?’ every Friday afternoon
One market observer lends his thoughts on the ongoing LCH compression row
Editor's Choice
Machine learning hits explainability barrier
Banks hire AI industry experts in face of growing regulatory scrutiny
Big Figure
A quick Trim?
Twenty-one European lenders were deemed non-compliant with the European Union's internal ratings-based credit modelling standards following the first phase of an industry-wide assessment. The European Central Bank released the interim results of its multi-year targeted review of internal models (Trim) at around 65 banks in June
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Our Take
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Humans struggle to keep pace with machine learning