Financial Services – Financial Risk Management

Have you mastered the management of risks and opportunities in the wake of the crisis?

The global crisis has changed the financial services industry and the way organisations manage and control risk. The institutions that will emerge strongest from the crisis are already planning how to adapt their risk management approach to the new business, capital, liquidity and especially the regulatory environment that is emerging. A key determinant for success will be the quality and insight of risk analysis and how well risk awareness is built into a financial institution's governance.

The challenges you face

• You want to improve your current risk management framework.
• You want to demonstrate the robustness of your financial institution with an internal capital adequacy assessment process (ICAAP) and stress testing.
• You need advice on value based asset and liability management, treasury, hedging or hedge accounting.
• You want to align your liquidity and funding risk framework to good market practice (e.g. stress testing, contingency planning, funding strategy and funds transfer pricing).
• You need to update your interest rate risk benchmarking models, replicating portfolios and scenario analysis.
• You want to strengthen your internal credit rating system, your credit portfolio management or your credit policies, pricing tools and procedures.
• You need to improve your valuation and risk measurement models, related processes and controls.

How PwC can support you

We support clients in the financial services sector in identifying, understanding and managing risk, and help ensure an appropriate balance between risk appetite and opportunities.

• We advise you on financial strategy, risk policy, governance and control.
• We design, review, validate and implement value based management solutions, internal rating solutions and value at risk frameworks.
• We design and embed risk frameworks across credit, market, liquidity, funding, operational, asset and liability risks.
• We provide advice relating to complex financial instruments (valuation, modelling, accounting, regulatory compliance, risk measurement and management, processes, systems and controls).
• We perform independent evaluations of risk management software.
• We develop and enhance earnings volatility management frameworks, including tailoring of hedge accounting solutions.
• We advise you on Basel III, capital planning and disclosure, IFRS 7, IFRS 9, RRV, FINMA circulars.