Risk Management
Risk Management & Compliance
At T3, we offer comprehensive coverage of all risk types and the entire risk management chain – from governance and strategy to reporting and implementation. Our expertise spans across Market Risk, Credit Risk, Model Risk, Operational Risk, Reputational Risk, AI Risk, and beyond. Whether you need support to implement, refine, review, or step in temporarily, T3 has the experts to cover the entire spectrum. We provide tailored solutions to enhance your risk management framework, ensuring robustness, compliance, and strategic advantage across your organization.
Today’s landscape
Market Risk Management
UK: The PRA is intensifying scrutiny of banks’ Market Risk Management under the Basel 3.1 framework, with final standards expected to be implemented by January 2025.
EU: The European Commission is progressing towards full implementation of the Fundamental Review of the Trading Book (FRTB) under Basel 3.1, focusing on Market Risk Capital Requirements (MCR) and Market Risk Weighted Assets (RWA).
US: The FED is enhancing stress testing requirements and market risk measurement standards, especially for institutions with significant trading activities.
HOW CAN WE HELP YOU?
VaR refinement and optimization
New event risk scenarios definition
Today’s landscape
Credit Risk Management
UK: The PRA has reinforced requirements related to IFRS 9 implementation and is enhancing Credit Risk Stress Testing frameworks.
EU: Basel 3.1 adoption continues, with a strong focus on capital adequacy and improving the accuracy of credit risk models.
US: Heightened supervisory focus on credit risk management practices, especially under stress testing frameworks and CCAR (Comprehensive Capital Analysis and Review).
HOW CAN WE HELP YOU?
Credit scoring models
PD, LGD, EAD modeling
Portfolio risk management
Credit stress testing
Credit risk reporting
Today’s landscape
Model Risk Management
UK: PRA’s focus on AI and ML model governance, including stress testing and explainability of models under evolving guidelines.
EU: EBA’s new guidelines on Model Risk Management (MRM) standards, aimed at enhancing governance and control of complex models.
US: Enhanced Model Risk Management requirements under SR 11-7 guidance, with added scrutiny on AI model explainability and robustness.
HOW CAN WE HELP YOU?
Model governance frameworks
Risk model auditing
Scenario analysis
Model tuning and optimization
Today’s landscape
Non-Traded Market & Funding Liquidity Risk
UK: PRA’s updates to Liquidity Stress Testing guidance under the Basel 3.1 framework.
EU: Introduction of enhanced requirements for Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) compliance.
US: Updates to liquidity risk management frameworks, especially under the Federal Reserve’s liquidity stress testing guidelines.
HOW CAN WE HELP YOU?
Liquidity stress testing
Liquidity risk reporting
Scenario analysis
Liquidity contingency planning
Today’s landscape
Non-Financial/Operational Risk Management
UK: Introduction of the Operational Resilience Framework, with regulatory requirements enforced by PRA and FCA.
EU: Increased focus on ICT and cybersecurity risk management under the Digital Operational Resilience Act (DORA).
US: Enhanced cybersecurity reporting requirements and operational risk management guidelines under the Federal Reserve and OCC.
HOW CAN WE HELP YOU?
Incident management planning
Today’s landscape
Reputational Risk Management
UK: The FCA emphasizes the importance of conduct risk, which directly impacts reputational standing, urging firms to uphold high standards of integrity and customer treatment.
EU: The EBA has integrated reputational risk considerations into its guidelines on internal governance, highlighting the need for robust risk management frameworks.
US: The SEC enforces stringent disclosure requirements, where failures can lead to significant reputational damage and legal repercussions.
HOW CAN WE HELP YOU?
Crisis Management Planning
Developing strategies to effectively respond to potential crises that could impact your reputation (more details on Crisis Management)
Stakeholder Communication Strategies
Crafting clear and transparent communication plans to maintain trust during challenging times.
Regulatory Compliance Advisory
Ensuring adherence to relevant regulations to mitigate risks associated with non-compliance.
Reputation Monitoring and Analysis
Implementing tools to continuously monitor public perception and address issues proactively.
Today’s landscape
Capital Risk Management
UK: The PRA mandates adherence to the Internal Capital Adequacy Assessment Process (ICAAP), requiring firms to assess and maintain appropriate capital levels.
EU: The Capital Requirements Directive V (CRD V) sets out stringent capital adequacy standards for financial institutions to promote financial stability.
US: The FED’s Comprehensive Capital Analysis and Review (CCAR) evaluates the capital planning processes and capital adequacy of large banks.
HOW CAN WE HELP YOU?
ICAAP Implementation Suppor
Assisting in developing and embedding robust ICAAP frameworks to meet PRA expectations.
Capital Planning and Stress Testing
Conducting rigorous stress tests to evaluate capital resilience under adverse scenarios.
Regulatory Compliance Assistance
Navigating the complexities of CRD V and CCAR requirements to ensure full compliance.
Optimization of Capital Structure
Advising on strategies to optimize your capital mix for enhanced financial flexibility.
Today’s landscape
Business Risk Management
UK: The Financial Reporting Council (FRC) emphasizes the importance of risk management in corporate governance, advocating for comprehensive risk assessment processes.
EU: The European Commission’s guidelines on non-financial reporting require companies to disclose principal risks and risk management approaches.
US: The Committee of Sponsoring Organizations of the Treadway Commission (COSO) provides a widely adopted framework for enterprise risk management, highlighting the need for integrated risk strategies.
HOW CAN WE HELP YOU?
Enterprise Risk Management (ERM) Framework Development
Designing and implementing ERM frameworks tailored to your organization’s needs.
Risk Identification and Assessment
Systematically identifying and evaluating risks across all business areas.
Strategic Risk Advisory
Aligning risk management strategies with your business objectives to enhance decision-making.
Regulatory Compliance Support
Ensuring adherence to relevant regulations and standards to mitigate compliance risks.
WHO DOES IT IMPACT?
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