EQECAT on earthquake losses in the Philippines; J.P. Morgan/Deloitte on Australia; Willis reports on Mining; Three US states require climate change survey; A.M. Best on the U.S. economy; Towers Watson on Predictive Modeling; Barry Zalma discusses “Murder for Life Insurance.”World Risk and Insurance News - 14 Feb
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J.D. Opdyke and Alexander Cavallo
In operational risk measurement, the estimation of severity distribution parameters is the main driver of capital estimates, yet this remains a non-trivial challenge for many reasons. Maximum likelihood estimation (MLE) does not adequately meet this challenge because of its well-documented non-robustness to modest violations of idealized textbook model assumptions, specifically that the data are independent and identically distributed (i.i.d.), which is clearly
An article in the Guardian today makes great claims that the Black-Scholes mathematical justification for trading options plunged the worlds banks into catastrophe. Ummm, I fair this is a little bit of a fanatical overstatement but let's ponder on this for a moment.
The equities market a decade ago cannot be compared to what it is today.
Over the last ten years, globalization really has become that, connectivity has reached the masses, the rise of Exchange Traded Funds, High Frequency Trading, the increase in the number of large positional hedge funds and the interest for sovereign powers to replace state funded pension programs with community based superannuation disbursements, are all driving factors for the emergence of asset bubbles.
In this short post we
Is ISO 31000 going to make the risk quantification mistakes that COSO did?
I have been following various debates on quantifying operational risk exposure on linked-in and elsewhere on the internet in the backdrop of risk standards such as COSO and ISO 31000.
What is a little disappointing is that it appears we might be falling into the same trap with ISO 31000 as the world has already done with COSO.
Let's take a look at the single problem around: What is the value of risk from an event?
Greek debt; a report from Swiss Re on earthquake losses and the under-insured; concerns from the Association of British Insurers over flood insurance in the UK, and warnings from Fitch Ratings regarding the impact of Solvency II on captives in the EU.
Cost cutting and better risk management remained high on the European financial services agenda at the recent World Economic Forum. Institutions worldwide are facing similar concerns, because of the ongoing instability in the current economic environment. Yet cost cutting initiatives and the move to further enhance risk management are often undertaken to the detriment of what customers today are looking for – innovation.
Regulation is intended to create transparency, but if not managed efficient
In my first newsletter of 2012 I have gone ‘back to basics’ and focussed on identifying and understanding Key Business Drivers.
Too often in management presentations, investor briefings and risk assessments - both enterprise and credit risk assessments - there is excessive focus on relatively unimportant aspects of a business or organization. This can be to the detriment of a full and through analysis of the true underlying drivers of revenues, cashflow and earnings.
I would welcome any though
We at BenefitPlace.biz and BPTradeShow.com would like to get started with a bold statement - All Employee Benefits are becoming Voluntary! What I mean by this is that while Employer Sponsored Plans remain the main portal for individuals to gain access to Insurance related Plans, Programs, and Services, Individual "Choice" is becoming more prevalent. Historically there were two types of Employer based Plan Designs that often were not integrated - "Core" and "Voluntary/Worksite Plans"! To gain
Dear GlobalRisk Community member/website visitor,
You recently downloaded a white paper from our website related to IT Security and cloud computing. Today we would like to offer you some great additional resources.
1. Navigating the Enterprise Software Minefield - 10 Critical Factors to Ensure Success
This paper will first outline the challenges of ERP selection and implementation and then offer practical advice and critical success factors to make sure your ERP process is smooth and effective
This presentation on Why Distributions Matter may be of interest. In it I highlight the deficiencies of the Cornish Fisher expansion to the Normal Distribution - now widely used by Hedge Funds to include the impact of excess skewness and kurtosis in their Value at Risk (VaR) calculations in the form of 'modified' Value at Risk or mVaR. I show that for just under 50% of all Hedge Funds tested the Cornish Fisher expansion is not appropriate and may give misleading and potentially dangerous VaR est
DO you have used/excess I.T. or data center gear you would like to liquidate? We can assist, we will return capital to your I.T. budget.
For most risk systems one big selling point is the heat map. It's tidy, it's colorful and in a macabre kind of way; it really energizes management to stare in ore at registered risks in the red zone.
Worthy or not, traditional heat maps distort risk reality, they squeeze risk into a two dimensional perspective that makes the reporting process itself as dangerous as it is useful.
A more light hearted story than yesterday's on airline safetly.
For those that read this story, Oliver previously worked in Risk Management for the Reserve Bank (Australia's central bank).
Oliver is clearly a risk management 'successs story'...
http://www.theage.com.au/executive-style/lucky-poker-ace-takes-16m-prize-20120131-1qqeg.html
All my historic blogs are at http://nigeles.blogspot.com/ - the original blog site covers three main areas of interest namely, public sector IT governance and security, treatment of depression and insomnia and the provision for the disabled in the UK which relates to my daughter's need for managed independent living.
Those blog entries with a more "work" flavour are also on wordpress http://nigelyahoo.wordpress.com/
Most of my comments to date on IT governance, cloud computing and IT security are
While the Davos event kicks on in the background, something worth taking a look at are the reports that have been released on the World Economic Forum's website.
The Insight Report on Global Risks 2012 (seventh edition) is an excellent and well pulled together paper.
Follow this link for more
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Recent and ancient history alike are full of failures of companies having disregarded the risks induced by their strategy. No sector is spared and even the most successful executive can trip over. The aggressive strategy by Jon Corzine (former CEO of Goldman Sachs) of turning a US brokerage firm into a “capital markets-focused investment bank” and growing proprietary trading to produce 20% of overall revenues of the firms led, less than 9 months later, to the liquidation of MF Global (October 31
“It's not the things you are afraid of that will kill you” - Mark Twain.
I have fielded a number of calls this week from recruiters looking for someone to implement a GRC process for some company. Before I can ask about firm's board governance towards risk management and accountability, the questions turn to SQL, Java and, well you get the idea. If a firm does not set its overall risk tolerance, understand its risk profile and empower managers who take risk to manage the risk, software isn't goin
In the world of risk 1+1 ≠2 and yet so many executives believe that it does but, while they do our banking risk systems will inevitably continue to fail us. Why are banks risk processes so broken?
Continue reading why 1+1≠2 by following this [ link ].
