Basel & Local Credit Risk Regulation

Regulatory Requirements & Reporting

We have over 30 years of banking experience, which have included local regulatory reporting in Panama and Costa Rica. We monitor regulations as they are issued and actively participate in the assessment of the requirements. Regulatory reports are mandatory and therefore should be addressed as a priority at all times. Requirements from the regulators are not directly embedded into the Credit Cycle, however penalties can pose a real threat to the business returns and the overall stability of the organization. Reporting compliance should be addressed automatically and it is critical to have robust databases in place.

We help you to review your regulatory reporting matrix to ensure adequate data submission is in place. We also have a network of professionals in different Latin American countries to support this task across the Region.

Regulatory & Economic Capital

Instead of waiting for uncertain events, quantify the scenarios in which extreme losses could take your business to bankruptcy and calculate the economic and regulatory capital you need to stay in business.

We provide methodological support for the calculation of Expected and Unexpected Losses (EL & UL), Risk Weighted Assets (RWA), Economic Capital (EC), and Regulatory Capital (RC) according to Basel Guidelines and Local Regulations.

Products:

  • Model Specification Document: Mathematical Algorithm and Formulation
  • Model Specification Training: Model Explanation Session
  • Data Requirement Document: IT Requirements
  • Reporting Process Manual: Auditable Reporting Manual
  • Reporting Process Advisory: Advisory During First Stage of Reporting Process
  • Parameter Estimation & Validation Process Manual: Auditable Manual
  • Parameter Estimation & Validation Training: Parameter Validation Training

Risk-Adjusted Profitability Measures

Identify which of your products, relationships, transactions, individual or business units are the most profitable in proportion to the risk taken in each of them.

We monitor the usual profit measurements, such as EBIT, ROA, and ROTA, but with a more diverse range of Risk-Based indicators such as Risk Adjusted Return on Capital (RAROC), Risk Adjusted Surplus, and the Shareholder Value Added (SVA) used as key elements for resource allocation. Monitoring a wider range of risk variables will help you construct the foundation for a sustainable profitable performance.

Products

  • Profitability Measures - Product Level
  • Profitability Measures - Relationship Level
  • Profitability Measures - Transactional Level
  • Profitability Measures - Individual or Business Unit Level

*All include the construction of actual values and a minimum of 6 months forecast.

Data Quality Assessments

Data can be considered the most critical Asset of any institution. One of the main initiatives you can implement is Data Quality Management. It is the foundation of any model you can develop.

According to the Data Warehousing Institute, the costs associated with poor data quality for American Businesses is around six hundred billion dollars, which includes millions in losses, fraud, and wasted opportunities.

We will help you develop multiple quality checks to ensure the integrity and accuracy of your data. We are experts in data warehouse development, data mining, and quality assessments.