credit (63)

SME Credit Repair

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As the US economy slowly emerges from the great recession many small businesses are looking upon battered and bruised balance sheets and income statements.  Before the downturn they looked young healthy and vibrant but the distress of the credit crunch, high unemployment and record business closures has taken its toll.  Receivables growing longer in the tooth each month.  Write offs of bad debt up.  Client defections, pinched profit margins and market erosion due to decreased buying power, busin
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China Shows Signs of Economic Weakness

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Dow Jones Market Wrap reports: 
 
...China's economy weakened sharply during the first two months of the year, deepening concerns that growth in the world's second-largest economy would decelerate further.
The country's top leaders now have tough decisions about whether to set aside economic overhaul measures that could pinch growth in the short-term.
The slowdown was across the board, including retail, manufacturing, housing and investment, as the National Bureau of Statistics released a raft of da
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Small Business Credit Index Improves

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The Experian Moody's Analytics Small Business Credit Index has posted its forth consecutive quarterly improvement.
"The Experian/Moody’s Analytics Small Business Credit Index rose 1.2 points to 117 due to the growth of small-business credit balances. According to the Q4 2013 report, the increase marked the fourth consecutive quarter of improvement in small-business credit conditions and provided the highest index reading since data tracking began in 2011.
"Credit is flowing more freely to small bu
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8028223865?profile=originalIncreasingly, organizations across all industries are charged with managing risk in a complicated compliance environment. Over at the Credit Union Times, Danny Baker, Vice President of Product Management, Risk & Compliance at Fiserv Inc., thinks he’s found a solution in the Cloud. In his recent article, “To the Cloud for Risk Management, Performance Analysis,” he argues that Credit Unions should turn to “Web-based or cloud portal” platforms that deliver enterprise risk management solutions.

Clou

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ERM Philippines

Enterprise Risk Management means alternate things to different people but the general angle risk analysts seem to take; is to create a risk assessment program or tick list sheet, then torture staff in their company to assess what they often don't fully understand.  This is fine but that is not Enterprise Risk Management in my opinion.  ERM is beyond simple risk assessments or check lists and it should consider a much wider charter of risk exposure quantification in the company.

In the presentatio

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Addressing Procyclicality

Really good paper on procyclicality and the problems with Basel III countercycle buffers

Perhaps one of the biggest issues facing banks with Basel III is how to address Procyclicality, especially if the bank is not running an Advanced IRB credit risk framework. Actually, just obtaining information about the different accepted practices on how to measure Procyclicality within a lending portfolio isn't so easy.

Just the other day however, I was pointed in the direction of a really good summary and p

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The National Credit Union Administration (NCUA) by mandate has added Enterprise Risk Management (ERM) and Sarbanes-Oxley (SOX) like financial reporting attestation compliance to the list of required activities for credit unions. Why has the NCUA put SOX, or financial reporting attestation, and ERM in the same ruling?

The NCUA has recognized that all regulatory compliance guidelines have required a risk assessment component, so it is only natural to require an Enterprise Risk Management (ERM) prog

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Credit Suisse - Eat your own cooking

The Partner Asset Facility

A novel concept that might be one way forwards for aligning bankers risk appetites to the outcome they create, is to entertain a Partner Asset Facility.
 
Credit Suisse has an innovative bonus structure which makes bankers eat their own cooking as the saying goes and ring fences traders bad deals into a bonus draw scheme with a bit of a twist.
 
See the video here by following this link
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Maturity across the Counterparty Credit Risk (CCR) and Credit Valuation Adjustments (CVA) space varies greatly across the industry. Our recent survey provided some interesting insights as to whether banks are ready for CCR and CVA under Basel III, thanks to detailed responses from our clients and academic participants.

 

We found that there are clear differences of opinion between academics and practitioners particularly when it comes to Basel III readiness for CCR. The same is reflected with rega

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Concentration Risk

Concentration risk is the "spread" of outstanding obligors or specifically the level of diversity that exists across a bank's loan portfolios. The lower the diversity, the higher the credit concentration risk.

In this blog post we look at the stress testing aspects around concentration risk and a presentation has also been attached to this journal which can be downloaded.

Click here to continue reading

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How much have recent events affected our perception of risks? How much are insurance firms really using this to their advantage? 

Like so many people, I was riding on the tube this morning when a passing advert shocked me so much that I had to take a picture. People looked at me, a little bewildered and like my actions were odd. I am a risk manager and an econometrician. I like numbers and probabilities. These prices made little sense to me: this is because they arenonsense.

According to this adve

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Funding Liquidity Risk

Basel III includes a new standard for Liquidity Risk which seems to be tripping up a few risk analysts attempting to reach this complex requirement.

In this post, we briefly look at the possible outcomes from a poorly managed liquidity risk program and the types of initiatives banks need to consider to meet the Basel III "International framework for liquidity risk measurement, standards and monitoring."

This post contains a presentation which can be downloaded 

Click here to read more

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UK banks are hiding retail losses

Unbelievable but unfortunately it appears that UK banks are heading for another disaster and so soon after the recent credit crisis took grip of the country.

It was reported by the FSA that UK banks have been hiding distressed retail assets by forcing a restructure to the amount of 68% of their portfolio. This is serious, perhaps one of the most serious pieces of news I have read for the last six months and is right up there with the collapse of the US dollar. In this blog article we are going to

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Satelites Mexicanos bankruptcy protection

According to the news released by Reuters (link) on Wednesday, April 6, 2011; Satelites Mexicanos S.A. de C.V. (Satmex) filed for bankruptcy protection in a Delaware court. Reuters stated that in court papers, Satmex said it will raise about $325 million in new financing by issuing high yield debt. It will also raise $96.2 million of new equity through a rights issue.
Thanks to the MORE rating evaluation done by modeFinance (link), the company’s deterioration in the credit ratings (in 2009 the MO
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Sport Media Group files for bankruptcy

According to the news in link on 2 April 2011, the publisher of “the Sunday Sport” and “The Daily Sport” has filed for bankruptcy since it has failed to meet its debts.Thanks to predictive feature of MORE ratings (link), it was already clear, by the year 2009, that the company was facing serious difficulties (see last year’s rating class: C). The fast deteriorating solvency and profitability indicators with a detailed comparison between the Sport Media and its competitors in the same sector were
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The International Organisation for Standardization has recently published a new ISO standard that targets rating agencies specifically. It announced this release on the 30th of March 2011 and is classifying the Credit Rating Agency Standard as a unique set of requirements labelled ISO 10674. In this article we are briefly going to look at what this standard aims to achieve, why it has come into existence and how it will be game changing for the credit rating agencies.

More can be found by followi

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