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Operational risk

Why Coso is flawed

Coso not only fails to help a firm assess its risks, it actually obfuscates the risk assessment process. By Ali Samad-Khan

Basel II recalibration for 2006 QIS5

BASEL -- The Basel Committee on Banking Supervision plans to conduct quantitative impact study five (QIS5) during 2006 -- the year during which parallel running will take place -- to recalibrate Basel II.

German banks get to grips with a new lending reality

Removal of state guarantees and pressure from shareholders for better returns means German banks can no longer churn out uneconomically priced loans to clients. Now they are starting to introduce sophisticated loan pricing systems, writes Duncan Wood

Below the radar

The upcoming Basel II capital Accord’s impact on the global banking industry is expected to be profound, and hardly painless. The Accord’s ramifications for the investment and hedge fund management sectors, while not nearly as obvious,could contribute…

From Basel II to Basel III

Financial institutions face major challenges in modelling credit portfolio risk, particularly in the field of CDOs. Walter Schulte-Herbrüggen and Gernot Becker argue that the main challenge will be in model testing, due to the increasingly customised…

Setting a timetable

Regulators in Australia and Japan are the latest to set deadlines for their banks to comply with Basel II, and both differ slightly from the Basel Committee’s schedule. Nick Sawyer reports

The importance of ALM

The crossfire between the International Accounting Standards Board and the European Commission seems to have left corporates bewildered about the implications of IAS 39. Risk talks to leading advisory groups and corporates about the challenges ahead, and…

Mind your behaviour

Hedge fund managers are becoming interested in behavioural theory, anincreasingly influential branch of economics that describes the role of intuitivebias in investment decision-making. According to one finance professor,behaviouralism provides valuable…

The game of life

UK life insurers have faced a new regulatory regime in the aftermath of the guaranteed annuity options disaster, which has led them to rethink their use of derivatives. Nicholas Dunbar talks to four leading life companies

Reducing risk through insurance

In this article, Silke Brandts describes a general algorithm for quantifying the risk-mitigating impact of operational risk insurance. She then presents a simple haircut approach to incorporate residual risks inherent in the insurance contracts into the…

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