Four Principles Of Risk Management – Identify risks and risk drivers, systematically manage vertical and horizontal risk aggregates, consolidate their impact and monitor them in real time; Success in an active trading environment depends on how proactive you are in risk management. This is where your choice of solutions and IT architecture play an increasingly important role.
Comprehensive and integrated risk management depends on a ready and proactive response to current and new market challenges and regulations. The following requirements are the basis for sustainable success:
Four Principles Of Risk Management
RISK RESOLUTION The system solution gives one answer to all your questions – an unlimited “yes”. VIEW RISK is a capable, powerful and multi-functional risk management software platform for multiple clients.
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Your long-term success and market position is based on real-time risk management, which allows you to reduce risk and optimize your investments.
Rapid response to market demands and new regulations enables DECIDE’s flexible, adaptable and extensible modular architecture that seamlessly integrates into your existing system and process structures.
By taking risks, you are optimally prepared for the challenges of digitization in a market environment where the innovation wheel turns faster for products, processes and technologies. Basel III, MiFID II, BCBS 239 and FRTB requirements have all been implemented and are constantly updated as necessary.
How to increase the efficiency of the use of working capital? How to reduce refinancing costs with risk-adjusted capital allocation? How is rapid implementation of Basel III, MiFID II, BCBS 239, FRTB and SREP requirements best achieved?
Four Principles Of Risk Management
The answers to all these questions contribute significantly to the success of risk management.
Against this background, concepts such as Personal Data Processing (PID) and fragmented “island IT solutions” have no future. Finally, modular software systems are required that are flexible, adaptable and extensible, meet modern requirements and achieve benchmarks in terms of total cost of ownership (TCO).
A particular strength of Risk is the presentation of analyzes and estimates. Automated event-driven reports can be generated after a few clicks and sent directly to relevant parties via email or SMS. Disclosures across the entire portfolio hierarchy by instrument or cash flow specific criteria ensure maximum exposure to risk. Threats from external systems can be imported through standardized interfaces and integrated into a comprehensive overview. Comprehensive reporting of results and data provides a precise chronological sequence of risk exposure and transparency in cross-border analysis.
The concept of an elastic parameterization is a RISK VIEW. With this background, you can compare the valuation, risk management and quotation parameters of different user groups and standardize them if necessary. Permission security is provided by DECIDE RISK at various levels. Clear rights management allows users to be assigned individually as needed. RISK’s powerful software is part of the Commerce Lifecycle Management, either as an enterprise solution or as a Software as a Service (SaaS).
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Along with counterparty risks, market risks in the trading and banking book play a key role in optimizing performance and making investment decisions in the financial market. Since the recent financial crisis, these minimum requirements have been in the spotlight.
Deciding on a modular risk block system reduces the effort required to create risk aggregates and thresholds. Impacts from different sources can be recorded and aggregated using different accounting methods. We believe a strong risk culture is critical to the long-term sustainability of a banking franchise. This ensures that our decisions and actions are customer-focused and not driven by short-term profits. Specifically, risk culture refers to the norms, attitudes, and behaviors associated with risk understanding, risk acceptance, risk management, and controls that shape risk decisions. At UOB, our risk-taking culture is based on our values.
Risk management is integral to UOB’s ability to create long-term value for our customers and stakeholders. Our risk culture is built on four principles: balancing sustainability with growth; ensure accountability for all our risk-based decisions and actions; and fostering understanding, engagement and consistent behavior in each employee. Each of these principles is based on specific UOB values that guide everything we do. By further strengthening the risk-taking culture of our franchisees, we maintain our financial security and stability; fair results and adequate support for our clients; a sustainable and sound business approach based on integrity, ethics and discipline.
UOB’s risk management structure is based on the Group’s risk culture as shown in the chart below. Within the structure, various risk and control oversight functions work with business and support units to identify their risks, mitigate their risks and self-assess controls.
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The objective of our risk management strategy is to facilitate the effective identification, management and mitigation of risks arising from external factors and our business activities, and to allocate appropriate capital to address these risks. Risk is carried out to the extent approved by senior management committees and approved by the board and its committees. We have established a framework of policies, methodologies, tools and processes to help identify, measure, monitor and manage material risks facing the Group. This allows us to focus our efforts on the bank’s fundamentals and create long-term value for all stakeholders.
The Group’s risk management framework, policy and appetite provide principles and guidance for the Group’s risk management activities. They help shape our key decisions in capital management, strategic planning and budgeting, and ensuring that risk measurement is properly and adequately accounted for. In particular, the Group’s Internal Capital Adequacy Assessment Process (ICAAP), which includes a stress test, takes into account the Group’s risk appetite to ensure that the Group’s capital, risk and return are at an acceptable level in various stress scenarios. We also consider the group’s risk appetite when developing risk-related key performance indicators (KPIs) to measure performance. It serves to establish a risk culture and risk management mindset in the organization.
Our risk identification, assessment, monitoring and reporting processes are governed by an existing risk management framework, policy and appetite. Risk reports are regularly presented to Management and the Board of Directors to keep them informed of the Group’s risk profile.
UOB’s responsibility for risk management begins with the Board’s oversight of the governance structure designed to ensure the Group’s business performance:
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In this regard, the Board of Directors is primarily supported by the Risk Management Committee (BRMC). The BRMC considers the level of risk appetite and risk capital to be maintained for the group.
The CEO has established senior management committees to help him make business decisions based on safety and returns. The main senior management committees involved here are the Executive Committee, the Risk and Capital Committee, the Assets and Liabilities Committee, the Credit Committee and the Operational Risk Management Committee. These committees also assist management committees in specific risk areas.
Management and senior management committees are empowered to set risk appetite limits by location, business unit and/or broad product line.
Risk Management – Every employee of the Group. Risk awareness and responsibility are embedded in our culture through a specific framework that provides appropriate oversight and accountability for effective risk management across groups and across risk types. This is accomplished through an organizational control structure that provides three “Lines of Defense”:
Commonwealth Risk Management Policy
Business and support functions have primary responsibility for implementing and implementing effective controls to manage risks arising from their business activities. This includes ensuring compliance with risk policies, appetite, limits and controls and establishing appropriate governance and control controls to identify control failures, process deficiencies and unexpected risk events.
The risk and control oversight functions (Group credit and risk management and group compliance) and the chief risk officer provide a second line of defense.
The risk and control oversight functions support the Group’s strategy to balance growth with sustainability by defining the risk frameworks, policies, appetites and limits within which development functions must operate. The risk and control oversight functions are also responsible for the independent review and monitoring of the Group’s risk profile, highlighting critical vulnerabilities and security issues for the relevant management committees.
The independence of risk and control oversight functions from business functions ensures that the necessary checks and balances are in place.
Safety Risk Management Review
The Group’s internal and external auditors conduct risk-based audits, covering all aspects of the first and second lines of defense, providing independent assurance to the CEO, audit committee and management on the effectiveness of the risk management, control structure, policies and frameworks. , systems and processes.
The group management framework also monitors our foreign subsidiaries through a matrix reporting structure. In consultation with Group Risk Management, our divisions adapt governance structures, frameworks and policies
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