Risk

Managing when vendor and supplier risk becomes your own

July 2013—Financial institutions are being held accountable for the actions of their suppliers. A new approach can help to identify and manage sources of third-party risk.more

Between deluge and drought: Liquidity and funding for Asian banks

April 2013—Strategic management of funding and liquidity will play an increasingly important role for Asian banks. Management should start preparing now to face future challenges, including maturity mismatches and the overall need for long-term funding to support growth.

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Concrete steps for CFOs to improve strategic risk management

April 2013–The role played by CFOs give them a natural, and perhaps unique, “in” when it comes to incorporating risk concerns into broader business planning processes. By sponsoring tighter coupling between risk and planning and by championing risk-informed analytics, CFOs can help significantly to enhance the risk-return thinking at the highest levels of strategy making.

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Ratings revisited: Textual analysis for better risk management

April 2013—Textual data—from analysts’ reports to blog posts—can help banks enhance their credit-risk models.more

Getting to ERM: A road map for banks and other financial institutions

March 2013—This working paper contains a diagnostic framework for assessing an organization's ability to manage risk at the enterprise level. McKinsey's ERM framework can help to shape discussion by senior management of ERM capabilities and shortcomings.

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Risk-based resource allocation: Focusing regulatory and enforcement efforts where they are needed the most

February 2013—Risk-based allocations of scarce resources is a necessary discipline for governments to demonstrate that they are becoming more efficient in their spending. This paper sets out an effective, 4-step process for better risk-based resource allocations.

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Between deluge and drought: The divided future of European bank-funding markets

March 2013—Despite some apparent short-term relief, culminating in the repayment by banks of some of the funds advanced to them by the European Central Bank (ECB), the long-term picture remains both complex and uncertain.

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It’s not just about getting your ratios right: Basel’s far-reaching new risk IT requirements

January 2013—New regulations from the Basel Committee are set to raise the bar on banks' requirements for IT capabilities to support their risk aggregation and reporting.

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Enterprise risk management: What's different in the corporate world and why

December 2012–This paper captures many years of experience in both the corporate and FIG worlds, explaining what each might learn from the other and where there might be pitfalls if techniques and approaches to ERM are imported unthinkingly across sectors.

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Commodity trading at a strategic crossroad

December 2012–This paper calls attention to the pressures faced by commodity traders in light of extremely competitive markets conditions and a plethora of existing and impending regulation. This is an industry on the cusp of profound changes.

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Capital Management: Banking's new imperative

November 2012–The paper is the latest version of our annual survey on capital management practices at leading banks and highlights some of the tensions between regulatory capital and economic capital approaches. It is of enormous relevance to all of our banking risk clients, featuring insights it gives into the uses of RWA optimization programs and the impacts of Basel II.5 and III.

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First-mover matters: Building credit monitoring for competitive advantage

October 2012–The paper assesses the challenge facing banks' core credit operations, which are under severe pressure from regulators and market conditions. Banks with superior credit processes have a strategic opportunity to create competitive advantage.

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Day of reckoning for European retail banking

July 2012—New regulations will lower returns for Europe's retail banks. McKinsey research lays out the scope of the problem and suggests ways that some banks may be able to regain lost ground.

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Wearing Varifocals—a new perspective on risk organization effectiveness and efficiency

March 2012–Traditional ways of looking at the risk organization often hinder a complete understanding of the risk function. A new article proposes a new way to look at the risk organization that will help financial institutions improve their organization's effectiveness and efficiency.

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