Risk and Compliance

Capital Allocation

The turbulence of the financial crisis and subsequent regulatory focus on reasserting systemic control has created challenging market conditions for all financial services institutions. These have resulted in dwindling sources of liquidity and capital, while also requiring numerous government interventions to secure the future of Financial Services organisations as well as sovereigns.

Political pressures to increase lending, and maintain higher capital and funding buffers are extremely difficult to deliver on whilst also focusing on making a return to profitability. Ultimately they require organisations to make significant investments in redefining their business strategy and adapting their operating models and modernising infrastructure accordingly to effectively manage the supply and demand of scarce resources.

Baringa’s Risk and Compliance consultants operate at the heart of this change, partnering with our clients to:

  • define and implement Credit, Debit and Funding Valuation Adjustment (CVA, DVA, FVA) strategies that optimise product pricing and counterparty risk management and associated capital requirements
  • review and optimise RWA calculation methodologies and inputs
  • define market leading liquidity risk management processes, and
  • define and implement collateral management and collateral transformation processes to support increasingly stringent requirements with regards to managing the risks related to OTC derivative products.

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