Risk Management
Latest Risk Management
Repo tokens won’t be cleared. Or will they?
Uncertainty lingers over clearing status of tokenised Treasuries, with decision likely devolved to DTCC
Op risk data: Japanese restaurant payments firm swallows $700m loss
Also: Bank of Baroda fraud filing, Wells’ Ponzi woes, and Swedbank’s Panama Papers payout. Data by ORX News
ECB finds gaps in geopolitical stress-testing frameworks
Current methods fail to properly capture impact of geopolitical stress on liquidity
FCMs back CFTC proposal granting opt-out from CME oversight
New rules aim to address conflicts of interests at vertically integrated exchange groups
A rookie’s guide to tokenised Treasuries
What are DTCC’s digital US government debt securities? How do tokenised repo and other transactions work? These questions, and others, answered
Have CCPs got better at absorbing shocks?
Data suggests most CCPs weathered the Iran-war disruption, but shock frequency is starting to bite
Model Risk Benchmarking
Lower-risk models face excessive reviews, banks say
Risk Benchmarking: Validation workload stretching teams, amid emerging regulatory divergence
Many banks do not document failure plans for Tier 1 models
Risk Benchmarking: Strong predeployment validation gives way to ad hoc escalation of breaches, even at some large lenders
Model risk managers see growing regulatory divergence
Risk Benchmarking study finds most banks expect easing of model risk supervisory scrutiny in the US, but tightening in Europe
Banks are automating GenAI testing, but scope varies widely
Risk Benchmarking: LLM-as-judge offers model testing at scale, but few lenders use it to facilitate autonomous sign-off
Risk Quantum
Data insights, delivered daily
Risk Quantum finds insights in data. The service tracks the public disclosures of over 120 banks, funds, insurers, corporates, and central counterparties – as well as reports from prudential and markets regulators – in Asia, Europe and North America.
Market RWAs surge across Chinese banks in Q1
Eleven of 13 lenders report increases as total hits record 2.97 trn yuan
Private credit risk
Banks demand look-through on private credit lending
Risk Live: Risk managers say they need to see underlying loans before lending to funds
European banks disclose €120bn of private credit exposure
Deutsche Bank and Barclays lead disclosed totals in Q1, but reporting gaps hamper comparison
The race to model private market risks
BlackRock maps holdings to risk factors; competitors aim to get the best from statistical methods
Private credit disclosures leave more questions than answers
Muddled metrics and scattergun reporting hinder comparison of US lenders
Clearing members want more from HKEX on collateral rates
The CCP has cut handling fees on posted margin, but is still paying members less than global peers
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