Portfolio risk management

By leveraging and sharing technical and operational knowledge and in-depth industry experience, Reply develops effective and pragmatic solutions. Reply takes the time to listen to its clients and evaluate their particular requirement, before offering a number of tactical and strategic choices. These are based on independent and challenging insights and supported by facts and industry benchmarks.

Reply’s implementation philosophy is underpinned by the following principles:

  • Demonstrating business value before implementation by executing a 'proof of benefit';
  • Driving process and organisation change early in parallel with infrastructure development – not build a system that no one will use;
  • Starting with small steps, beginning with a single organisation to test the processes and technology in real business situations, then scale these up to other divisions;
  • Building momentum and then rapidly deploy solutions to the remainder of the organization once any issues are worked out.
  • Providing support throughout.

Our Portfolio risk management service offering is focused on the following key industries:

  • Banks and building societies
    Sweeping regulatory changes are forcing banks to develop more effective tools to model and recognise risk and ensure alignment with the specific characteristics of the business. Consequently, there is a call for more rigorous methods to tie risk events to capital requirement, cash flow requirement and earnings’ expectations.
  • Asset Management
    Many asset managers are moving into new and more complex strategies, including hedge funds, liability driven investments and absolute-return retail products. The increasing complexity of business operations has increased demands for back-office operations and processing, including for UCITS III. There is a risk that an organisation’s existing systems and controls may be unable to deal with this increase in complexity of products and underlying assets.
  • Non financial institutions
    The fallout from corporate scandals and increased market volatility has given greater emphasis to performance measurement and risk management in many enterprises. Shareholders, banks, insurance companies, credit rating agencies and other stakeholders are seeking greater transparency regarding the risk reward ratios that adopted by management. There is an expectation that the scope of risk management extends beyond traditional financial and market risk to encompass enterprise-wide risks.
  • Insurance companies
    The pace of regulatory change in the insurance industry is accelerating as a result of the EU’s Solvency 2 initiative. Many insurance firms in Europe have already developed tools to model risk and capital adequacy. But Solvency 2 raises the bar, making much more stringent demands on statistical validation of the models that go to make up an economic capital framework.

If you would like to know more about what we can do for you, contact us.

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Solution

Definio Reply™

Definio Reply is an open and flexible system for Financial Risk and Performance Management.

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Introducing “Basel 4”

Changing the methods used to calculate regulatory capital with regards to market risk.