The silver lining: Converting stress-test tools to strategic assets

– In response to regulatory mandates, banks in the United States and Europe have developed some of the most robust risk management and stress-testing capabilities in history. The next step is for banks to convert these capabilities into true strategic and business assets.

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McKinsey on Risk

– A new publication that brings together the best thinking from McKinsey’s Global Risk Practice.

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Nonfinancial risk: A growing challenge for the bank

– With credit and market risks now under better control, the focus is shifting to nonfinancial risks. Managing these well will require... big shifts in banks’ practices.

The future of bank risk management

– Banks have made dramatic changes to risk management in the past decade—and the pace of change shows no signs of slowing.... Here are six initiatives to help them stay ahead.

The evolving role of credit portfolio management

– Banks can no longer manage loan books in isolation. A new survey reveals how portfolio managers are dealing with growing complexity.

The value in digitally transforming credit risk management

– To withstand new regulatory pressures, investor expectations, and innovative competitors, banks need to reset their value focus... and digitize their credit risk processes.

SREP: How Europe’s banks can adapt to the new risk-based supervisory playbook

– The first round of Europe’s new supervisory process is in the books, and the next one is under way. Banks are likely to... face new challenges from heightened supervisory expectations.

Managing non-financial risk in banking: Paradigm shifts in the making

– Banks are accustomed to taking on financial risk as part of their business models, but non-financial risk (NFR) has only a downside... if not managed. And the downside can be large. We discuss nine paradigm shifts which have the potential to really improve management of NFR.

A best-practice model for bank compliance

– Tighter compliance regulations have challenged financial institutions in a variety of ways. Yet those who adapt best may enjoy... a distinct competitive advantage.

Economic Conditions Snapshot, December 2015: McKinsey Global Survey results

– Growing shares of executives say geopolitical instability is a risk to both global and domestic growth. At the same time, their... views on overall conditions have improved notably—but remain tempered on China’s prospects.

P&L forecasting–the new horizon of stress testing, and beyond

– Banks have not invested much into modelling capabilities for profit and loss, particularly in Europe. If they want to anticipate... and possibly shape the regulatory agenda, they need to do so now.

Taking the stress out of operational-risk stress testing

– Financial institutions are facing heightened supervisory scrutiny, but those that establish a structured and calibrated approach... to operational-risk stress testing will thrive.

The Fundamental Review of the Trading Book: Implications and actions for banks

– The FRTB framework promulgated by the Basel Committee on Banking Supervision to improve trading book capital requirements will... necessitate rapid and potentially drastic change for all banks with a trading presence. There are five critical steps banks should take to prepare.

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