This book focuses on identifying and explaining the key determinants of scenario analysis in the context of operational risk, stress testing and systemic risk, as well as management and planning. Each chapter presents alternative solutions to perform reliable scenario analysis. The author also provides technical notes and describes applications and key characteristics for each of the solutions. In addition, the book includes a section to help practitioners interpret the results and adjust them to real-life management activities. Methodologies, including those derived from consensus strategies, extreme value theory, Bayesian networks, Neural networks, Fault Trees, frequentist statistics and data mining are introduced in such a way as to make them understandable to readers without a quantitative background. Particular emphasis is given to the added value of the implementation of these methodologies.

Enterprise risk management is a complex yet critical issue that all companies must deal with as they head into the twenty-first century. It empowers you to balance risks with rewards as well as people with processes. But to master the numerous aspects of enterprise risk management, you must first realize that this approach is not only driven by sound theory but also by sound practice. No one knows this better than risk management expert James Lam. In Enterprise Risk Management: From Incentives to Controls, Lam distills twenty years' worth of experience in this field to give you a clear understanding of both the art and science of enterprise risk management. Organized into four comprehensive sections, Enterprise Risk Management offers in-depth insights, practical advice, and real world case studies that explore every aspect of this important field. Section I: Risk Management in Context lays a solid foundation for understanding the role of enterprise risk management in today’s business environment. Section II: The Enterprise Risk Management Framework offers an executive education on the business rationale for integrating risk management processes. Section III: Risk Management Applications discusses the applications of risk management in two dimensions–functions and industries. Section IV: A Look to the Future rounds out this comprehensive discussion of enterprise risk management by examining emerging topics in risk management with respect to people and technology. JAMES LAM is President of James Lam & Associates, an independent risk advisory firm. Before starting his own firm, Lam was founder and president of ERisk and partner of Oliver, Wyman & Company. In 1997, as chief risk officer at Fidelity Investments, he was named the first-ever Financial Risk Manager of the Year by the Global Association of Risk Professionals. Prior to Fidelity, he was chief risk officer of Capital Markets Services, Inc., a GE Capital Company. Lam graduated with honors from Baruch College and received his MBA from UCLA. He is also currently an Adjunct Professor of Finance at Babson College.

Banks, like other businesses, endeavor to drive revenue and growth, while deftly managing the risks. Dubbed the next "frontier" in risk management for financial services, climate related risks are the newest and potentially the most challenging set of risks that banks are encountering. On the one hand, banks must show their commitment to becoming net zero and, on the other, help their customers transition to more sustainable operations, all this while managing climate-related financial risks. It is a paradigm shift from how the banking industry has traditionally managed risks as climate change risks are complex. They are multilayered, multidimensional with uncertain climate pathways that impact real economy which in turn influences the financial ecosystem in myriad ways. Climate Change Risk Management in Banks weaves the complete lifecycle of climate risk management from strategy to disclosures, a must-read for academics, banking professionals and other stakeholders interested in understanding and managing climate change risk. It provides much-needed insights, enabling organizations to respond well to these new risks, protect their businesses, mitigate losses and enhance brand value. Saloni Ramakrishna, an acknowledged financial industry practitioner, argues that given the uncertain and volatile climate paths, complex geopolitical patterns, and sustainability challenges, banks and business professionals will benefit from a wholistic approach to managing climate change risks. The book provides a blueprint and a cohesive framework for embracing and maintaining such an approach, in a simple and structured format.

At a time when corporate scandals and major financial failures dominate newspaper headlines, the importance of good risk management practices has never been more obvious. The absence or mismanagement of such practices can have devastating effects on exposed organizations and the wider economy (Barings Bank, Enron, Lehmann Brothers, Northern Rock, to name but a few). Today's organizations and corporate leaders must learn the lessons of such failures by developing practices to deal effectively with risk. This book is an important step towards this end. Written from a European perspective, it brings together ideas, concepts and practices developed in various risk markets and academic fields to provide a much-needed overview of different approaches to risk management. It critiques prevailing enterprise risk management frameworks (ERMs) and proposes a suitable alternative. Combining academic rigour and practical experience, this is an important resource for graduate students and professionals concerned with strategic risk management.

A practical guide, from the basic techniques, through to advanced applications, showing you what risk management is, and how you can develop a successful strategy for your company.

Identify, assess, and mitigate operational risk with this practical and authoritative guide In the newly revised second edition of Operational Risk Management: A Complete Guide for Banking and Fintech, accomplished risk executive and expert Philippa Girling delivers an insightful and practical exploration of operational risk in organizations of all sizes. She offers risk professionals and executives the tools, strategies, and best practices they need to mitigate and overcome ever-present operational risk challenges that impact business in all industries. This latest edition includes: Insight into how operational risk can be effectively managed and measured in today's digital banking age. Updates on the latest regulatory guidance on operational risk management requirements in all aspects of the operational risk framework. Updates on the new Basel II capital modeling methodology for operational risk. New explorations of operational risk events in recent years including the impact of the global Covid-19 pandemic. Updated case studies including large events at Wells Fargo, Credit Suisse and Archegos Capital Management. Ideal for executives, managers, and business leaders, Operational Risk Management is also the perfect resource for risk and compliance professionals who wish to refine their abilities to identify, assess, mitigate, and control operational risk.

This publication serves as a roadmap for exploring and managing climate risk in the U.S. financial system. It is the first major climate publication by a U.S. financial regulator. The central message is that U.S. financial regulators must recognize that climate change poses serious emerging risks to the U.S. financial system, and they should move urgently and decisively to measure, understand, and address these risks. Achieving this goal calls for strengthening regulators’ capabilities, expertise, and data and tools to better monitor, analyze, and quantify climate risks. It calls for working closely with the private sector to ensure that financial institutions and market participants do the same. And it calls for policy and regulatory choices that are flexible, open-ended, and adaptable to new information about climate change and its risks, based on close and iterative dialogue with the private sector. At the same time, the financial community should not simply be reactive—it should provide solutions. Regulators should recognize that the financial system can itself be a catalyst for investments that accelerate economic resilience and the transition to a net-zero emissions economy. Financial innovations, in the form of new financial products, services, and technologies, can help the U.S. economy better manage climate risk and help channel more capital into technologies essential for the transition. https://doi.org/10.5281/zenodo.5247742

The Risk Management Handbook offers readers knowledge of current best practice and cutting-edge insights into new developments within risk management. Risk management is dynamic, with new risks continually being identified and risk techniques being adapted to new challenges. Drawing together leading voices from the major risk management application areas, such as political, supply chain, cybersecurity, ESG and climate change risk, this edited collection showcases best practice in each discipline and provides a comprehensive survey of the field as a whole. This second edition has been updated throughout to reflect the latest developments in the industry. It incorporates content on updated and new standards such as ISO 31000, MOR and ISO 14000. It also offers brand new chapters on ESG risk management, legal risk management, cyber risk management, climate change risk management and financial risk management. Whether you are a risk professional wanting to stay abreast of your field, a student seeking a broad and up-to-date introduction to risk, or a business leader wanting to get to grips with the risks that face your business, this book will provide expert guidance.

Leading the way in this field, the Encyclopedia of Quantitative Risk Analysis and Assessment is the first publication to offer a modern, comprehensive and in-depth resource to the huge variety of disciplines involved. A truly international work, its coverage ranges across risk issues pertinent to life scientists, engineers, policy makers, healthcare professionals, the finance industry, the military and practising statisticians. Drawing on the expertise of world-renowned authors and editors in this field this title provides up-to-date material on drug safety, investment theory, public policy applications, transportation safety, public perception of risk, epidemiological risk, national defence and security, critical infrastructure, and program management. This major publication is easily accessible for all those involved in the field of risk assessment and analysis. For ease-of-use it is available in print and online.

A global banking risk management guide geared toward the practitioner Financial Risk Management presents an in-depth look at banking risk on a global scale, including comprehensive examination of the U.S. Comprehensive Capital Analysis and Review, and the European Banking Authority stress tests. Written by the leaders of global banking risk products and management at SAS, this book provides the most up-to-date information and expert insight into real risk management. The discussion begins with an overview of methods for computing and managing a variety of risk, then moves into a review of the economic foundation of modern risk management and the growing importance of model risk management. Market risk, portfolio credit risk, counterparty credit risk, liquidity risk, profitability analysis, stress testing, and others are dissected and examined, arming you with the strategies you need to construct a robust risk management system. The book takes readers through a journey from basic market risk analysis to major recent advances in all financial risk disciplines seen in the banking industry. The quantitative methodologies are developed with ample business case discussions and examples illustrating how they are used in practice. Chapters devoted to firmwide risk and stress testing cross reference the different methodologies developed for the specific risk areas and explain how they work together at firmwide level. Since risk regulations have driven a lot of the recent practices, the book also relates to the current global regulations in the financial risk areas. Risk management is one of the fastest growing segments of the banking industry, fueled by banks' fundamental intermediary role in the global economy and the industry's profit-driven increase in risk-seeking behavior. This book is the product of the authors' experience in developing and implementing risk analytics in banks around the globe, giving you a comprehensive, quantitative-oriented risk management guide specifically for the practitioner. Compute and manage market, credit, asset, and liability risk Perform macroeconomic stress testing and act on the results Get up to date on regulatory practices and model risk management Examine the structure and construction of financial risk systems Delve into funds transfer pricing, profitability analysis, and more Quantitative capability is increasing with lightning speed, both methodologically and technologically. Risk professionals must keep pace with the changes, and exploit every tool at their disposal. Financial Risk Management is the practitioner's guide to anticipating, mitigating, and preventing risk in the modern banking industry.