Part 2
Risk Capital Attribution and Risk-adjusted Performance Measurement
After completing this reading, you should be able to: Define, compare, and contrast risk capital, economic capital, and regulatory capital, and explain methods and motivations for using economic capital approaches to allocate risk capital. Describe the RAROC (risk-adjusted return on…
Range of Practices and Issues in Economic Capital Frameworks
After completing this reading, you should be able to: Within the economic capital implementation framework, describe the challenges that appear in: Defining and calculating risk measures. Risk aggregation. Validation of models. Dependency modeling in credit risk. Evaluating counterparty credit risk….
Capital Planning at Large Bank Holding Companies – Supervisory Expectations and Range of Current Practice
After completing this reading, you should be able to: Describe the Federal Reserve’s Capital Plan Rule and explain the seven principles of an effective capital adequacy process for bank holding companies (BHCs) subject to the Capital Plan Rule. Describe practices…
Sound Management of Risk Related to Money Laundering and Financing of Terrorism
After completing this reading, the candidate should be able to: Explain the best practices the Basel Committee recommends for the assessment, management, mitigation, and monitoring of money laundering and financing of terrorism (ML/FT) risks. Describe recommended practices for the acceptance,…
Stress Testing Banks
After completing this reading, you should be able to: Describe the historical evolution of the stress testing process and compare methodologies of historical EBA, CCAR, and SCAP stress tests. Explain challenges in designing stress test scenarios, including the problem of…
Principles for the Effective Management and Supervision of Climate-related Financial Risks
After completing this reading, you should be able to: Describe the principles for the management of climate-related financial risks related to corporate governance and internal control framework. Describe the principles for the management of climate-related financial risks related to capital…
Risk Governance
After completing this reading, you should be able to: Explain Basel regulatory expectations for an operational risk management framework’s governance. Describe and compare the roles of different committees and the board of directors in operational risk governance. Describe the…
Machine Learning and AI for Risk Management
After completing this reading, you should be able to: Explain the distinctions between the two broad categories of machine learning and describe the techniques used within each category. Analyze and discuss the application of AI and machine learning techniques in…
Operational and Integrated Risk Management
Introduction to Operational Risk and Resilience Risk Governance Risk Identification Risk Measurement and Assessment Risk Mitigation Risk Reporting Integrated Risk Management Cyber-resilience: Range of Practices Case Study: Cyberthreats and Information Security Risks Sound Management of Risks related to Money Laundering…
Operational Resilience: Impact Tolerance for Important Business Services
After completing this reading, you should be able to: Describe an impact tolerance; explain best practices and potential benefits for establishing the impact tolerance for a business service. Provide and explain criteria that firms should use to determine their important…
