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On 15^th September 2008, Lehman Brothers declared itself bankrupt. In one of the most dramatic events of the 2007-2008 global financial crisis, the 160-year old institution collapsed due to its exposure to subprime mortgages. After Lehman's failure, financial markets entered a period of unprecedented volatility and governments spent trillions of dollars attempting to restore confidence in the banking industry. Five years on, how has the banking industry landscape changed?

On the one hand, the risk

I have been running a survey and with more than 100 completed I am getting an interesting picture of the challenges my readership is facing. Here are the results and my interpretation of what they mean.

First of all, I should answer the question “What does the profile of respondents look like?” Put simply, my readership base and those that responded are typical of the risk profession. You are a mix of senior risk professionals in larger organisations, risk advisors who work for senior risk profes

The third step in the Risk Management and Own Risk and Solvency Assessment Model Act (RMORSA) is the implementation of a Risk Appetite and Tolerance Statement. This step is meant to sets boundaries on how much risk your organization is prepared to accept in the pursuit of its strategic objectives.

An organization-wide risk appetite statement provides direction for your organization and is a mandatory part of your assessment. As defined by COSO (one of the risk management standards measured in the

The first step in the Risk Management and Own Risk and Solvency Assessment Model Act (RMORSA) implementation, Risk Culture and Governance, lays the groundwork and defines roles for your risk management function. The second step, Risk Identification and Prioritization, defines an ongoing risk intelligence process that equips an organization with the data needed for risk based decision making.

The engine behind this process – the enterprise risk assessment – isn’t a new concept, but organizations a

The National Association of Insurance Commissioners adoption of the Risk Management and Own Risk and Solvency Assessment Model Act (RMORSA) requires insurance organizations to take a broader approach to risk management. As US insurers begin to mobilize their efforts to comply with the regulation by the 2015 deadline, it’s important for insurers to take a step back, leverage their existing risk management operations, and develop their RMORSA efforts with a mind to the future.

The groundwork for RM

Strategic Risk Management and Enterprise Risk Management are invariably linked. Organizations focusing on Strategic Risk Management (SRM) understand that it's not always an individual risk that results in a loss event, but the failure to adequately account for a number of related risks, goals, or requirements.

Examining the adoption of SRM, Rodd Zolkos of Business Insurance finds a great deal of overlap with the core principals of Enterprise Risk Management. His article, "Interest in strategic ri

The European Securities and Markets Authority (ESMA) has done it again. They quietly published a revised European Market Infrastructure Regulation (EMIR) timeline which postpones commencement of Trade Repository (TR) reporting until February 2014. This is no surprise as the recent third round of their Questions & Answers (Q&A) still left uncertainty among market participants.

There is no doubt that the regulation comes at a significant cost and requires wide-ranging operational enhancements to en

Baby-boomers will soon be transferring their assets to generations X and Y, primarily defined by their exposure to technology and the web from an early age. As banks’ relationship management styles gravitate towards digital mediums, their next priority should be the associated customer data. How can banks adapt their IT infrastructures to manage the amounts of data new generations are generating?

In today’s digitalised world customer data is increasing daily. Social media alone (Twitter, Facebook

Insurers need to comply with multiple regulations like Solvency II by implementing effective Enterprise Risk Management frameworks. But what is Enterprise Risk Management?

Enterprise Risk Management is a risk management approach meant to encompass all risks and opportunities across the entire enterprise — including the governance, risk and compliance (GRC) aspects. One of the Enterprise Risk Management best practices is to embed the process into strategic planning. Enterprise Risk Management shou

Of course, Solvency II has not gone away. The new solvency requirements will be implemented. But the lull in urgency to meet an enforcement date is triggering a predictable and understandable reaction from those insurers that are responding to Solvency II with a compliance approach rather than a best practice corporate governance and risk management approach.

The ‘compliance only’ firms are easing off their SII projects, taking a well earned break from the stress and expense, and re-allocating re

The economic climate and tightening regulations are prompting large enterprises to invest in capability management tools - a new category of software that helps senior decision-makers to understand the organisation’s readiness to implement new initiatives.

Large, complex enterprises run a huge risk every time they implement a new strategic initiative. The risk is that something important will have been overlooked in the planning stage that will cause the initiative to fail, run over time or over

Wall Street Journal - Risk & Compliance Journal

Chobani’s recent problem of mold in its yogurts shows the early warning that can come from social media but also the difficulties consumer companies can face in responding quickly enough to satisfy their consumers. The company announced its voluntary recall on Sept. 5 after it began notifying stores to take product off the shelves late in the week of Aug. 26, but an analysis of social media done for Risk & Compliance Journal by ListenLogic, a provid

Nearshore delivery models remain a valid response to many of the pressures financial institutions face today. The challenge is that they tend to focus on areas such as application maintenance rather than transformation. How can organisations sustain truly transformational IT projects that call for continuous and agile interaction between the business, architects and development teams?  

Financial institutions must take a more responsive approach to nearshore. Flexible styles of working are ideal

Of all the global sporting contests, few parallel investment banking as well as the America’s Cup regatta. The latest round of the world’s oldest sporting competition kicks off in San Francisco this month and provides a timely, unique comparison to the evolution of risk management in the global financial services industry.

In 1851, an American schooner raced with the Royal Yacht Squadron around the Isle of Wight off the southern coast of Great Britain,  winning a surprising victory and setting in

Managing Risk with Options

Our partner, TraderMinute.com launched its first public $100K challenge in March of 2013. The Challenge is a unique concept where they try to turn $3,000 into $100,000 in only 4 months! They use a live brokerage account and allow active subscribers to follow each trade in real time via email, text, and live video.  The question is: Have they ever turned $3k into $100k? Yes: They have accomplished this feat twice with other success of 47K, 19K, 21K, 4K, and 4 losses.

The Basel Committee, which creates regulations for banks, has published a set of principles regarding effective risk data aggregation and risk reporting, which will provide a fantastic business case for risk professionals to improve their risk frameworks. I’ve included highlights below, but you can take a look at the full report here.

The principles for effective risk data aggregation and risk reporting will be mandatory for globally systemically important banks (G-SIBs) from 2016, and the Basel

L’exercice 2013 de preparation a Solvabilite II, something close to a French Solvency II dry run scheduled for September 2013, gives French insurers the chance to immediately take advantage of the lessons learned by other European insurers that raced to be ahead of the Solvency II curve. Many of the mid-size and small French mutual insurers (les mutuelles) held back from initiating projects and they can now draw on the best practices that have come out of early adopter projects across Europe fro

The new category of domestic systemically important banks will increase the data management and disclosure burden on qualifying institutions, at a time when many are already feeling the strain.

Banks that escaped classification as G-SIFIs in 2011 may have breathed a sigh of relief at the time, but for many, that relief will have been short-lived. In October last year, the Basel Committee on Banking Supervision (BCBS) set out its proposed framework for an additional category of systemically import