HAU

Foundations of Banking Risk

A robust and pervasive risk culture throughout a financial institution is an essential and fundamental tool for effective risk management.

The course is designed around globally acknowledged risk management concepts and international regulatory standards. Those who attend this course will demonstrate a broad knowledge and understanding of risk management methodologies, governance structures for the management of risk in financial institutions, and the global regulatory requirements.

Learning outcomes

• Understand the forms and functions of banking and main bank management issues
• Recognize the link between risk and bank regulation
• Understand the core drivers of credit, market and operational risks
• Recognize the main characteristics of various credit products and financial instruments
• Understand the main points of operational risk management
• Understand the link between bank risk and capital requirements
• Understand the challenges in the post crunch global banking market

Download full description of the "Foundations of Banking Risk" course (.pdf, 351KB)

Content

Functions and Forms of Banking

• Banks and Banking
• Different types of banks
• Banking risk
• Forces shaping the banking industry

Managing Banks

• Bank Corporate Governance
• Balance Sheet and Income Statement
• Asset and Liability management
• Loan losses

Banking Regulation

• From Liquidity Crisis to Bank Panics
• Foundations of Bank regulation
• International Regulation of Bank risks
• Deposit Insurance

Credit Risk

• Introduction to Credit Risk
• Lenders
• Borrowers
• Characteristics of credit products
• Credit products

The Credit Process and the Credit Risk Management

• The Credit Process
• The Credit Analysis Process
• Portfolio Management

Market Risk

• Introduction to Market Risk
• Basics of Financial Instruments
• Trading
• Market Risk Measurement & Management
• Market Risk Regulation

Operational Risk

• What is Operational Risk?
• Operational Risk Events
• Operational Loss Events
• Operational Risk Management

Regulatory Capital & Supervision under Basel II

• Bank regulatory capital
• Basel II minimum capital requirements
• Pillar 2 – Supervisory review
• Pillar 3 – Market discipline
• What is the role of economic capital

Basel II Accord

• The main points of the Accord
• Proposed changes to the Accord in light of the financial crisis

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