Risk Management Consulting

RISK MANAGEMENT CONSULTING

At NeuralTechSoft we provide an assortment of risk management solutions to organisations in the banking, insurance, asset management, corporate treasury sector. Our team boasts of quantitative, regulatory and technological skills with extensive experience in the banking, insurance and asset management sector. The core members of our team constitute of seasoned industry practitioners who have provided risk management services to prominent financial institutions worldwide. This vast experience allows us to ask better questions and create solutions that are specifically tailored to the size and complexity of the client’s business. While devising risk management framework, we follow the following process:

  • Risk identification
  • Risk Measurement/Estimation
  • Risk Review & Analysis
  • Risk Appetite Determination
  • Risk Control
  • Risk Reporting (To all stakeholders)

We perform a comprehensive enterprise risk measurement study and devise an optimal risk management infrastructure for our clients. Our team inspects the pre-existing enterprise risk management framework and suggests enhancements to further improve its effectiveness. We adopt a methodical and scientific approach to identify and suggest ways to hedge against the major exposure of the firm while analyzing the correlation between various risks.

We provide a comprehensive range of credit risk solutions to financial institutions that include the identification, measurement, modelling, monitoring and reporting of credit risk.

We help our clients to align their risk processes, policies and tolls with industry best practices. We also provide assessment of credit risk measurement models as well as compliance with regulatory requirements.  Our suite of credit risk solutions includes the following:

  • Design, develop and review of policies, procedures, systems, and organisational structure for credit risk management
  • Strategic advice on credit risk management such as setting risk appetite and credit concentration limits
  • Risk grading frameworks, pricing and capital allocation models, and provisioning processes and models for retail and wholesale credit portfolios
  • Improvements in credit assessment and analysis, approval processes, administration and settlement
  • Compliance with regulatory & statutory requirements such as Basel related capital requirements and requirements under IFRS9
  • Credit and model risk frameworks, credit policy and management information statements and portfolio monitoring and reporting
  • Design, develop and validate models using machine learning and artificial intelligence concepts for credit risk of large corporates, MSME and unbanked small businesses and enterprises

Market risk encompasses the following categories of risk:

  • Price Risk
  • Liquidity Risk
  • Basis Risk

Our market risk solutions are based on a comprehensive analysis to ensure that the market risk management framework suits the strategic objectives of the client, the complexity of the risks to which it is exposed and its risk appetite.

Our suite of Market risk management services includes the following:

  • Review of market risk management practices in comparison to industry best practices as well as regulatory guidelines
  • Development and validation of risk measurement models, for trading as well as banking books
  • Development of an asset-liability management (ALM) framework
  • Development of associated market risk policies and procedures
  • Development of Liquidity and interest rate risk measurement and management framework
  • Development of framework for stress testing and funds transfer pricing
  • ALM monitoring and reporting framework
  • Review of Treasury processes and treasury process transformation
  • Valuation of complex derivative instruments and other market instruments
  • Scenario generation, analysis and stress testing

As a part of our Operational Risk Management services, we advise clients on the identification, assessment, modelling/measurement, monitoring, management and reporting of operational risks.

We assist clients with:

  • Strengthening operational risk management frameworks to align them with industry best practices and regulatory demands
  • Developing and validating operational risk capital calculation models to determine capital allocation to cover operational risk exposures
  • Operational risk measurement and analytics using risk quantification techniques such as quantitative risk assessment and scenario analysis
  • Developing capital requirements for Basic Indicator Approach (BIA), Standardized Approaches and Advance Measurement Approach including in the migration to more sophisticated approach in accordance with the Basel requirement

Value-at-Risk (VaR) helps identify losses under normal market conditions but it is an inadequate measure for losses in case of sharp adverse stress. The inadequacy of VaR to estimate the downside losses in exceptional circumstances stresses upon the importance of stress testing.

We provide a comprehensive stress test analysis that includes:

  • Analysis of the variance between the baseline and stress values
  • Evaluation of metrics across various business units, product types and risks
  • Comparison of results across a multitude of stress scenarios of various magnitudes
  • Determining the risk appetite of the organisation under extreme conditions
  • Computing the current and future capital requirement of the organisation

Strategic risk management is the procedure of proactively identifying, analysing, quantifying and addressing uncertainties that are influenced by internal or external events that could hinder the advancement towards strategic goals which aim at creating and protecting shareholder value.

We comprehend that financial institutions have different maturity levels, in terms of their business goals, risk exposure and size, and accordingly recommend steps to acquire effective risk management. A firm employs a certain strategy in order to achieve some goal- long term or short term. There are risks pertaining to the strategy- factors included in its execution, as well as risks of the strategy, i.e., the risks created when the strategy is undertaken. We provide optimal strategic risk management that strikes a balance between these two kinds of risks.