Evolution or Revolution?
Prior to the crisis, most financial institutions did not perform stress tests that encompass a comprehensive firm-wide perspective across all risk types and businesses. Instead, they mainly relied on risk models, assuming that historical relationships constitute an adequate basis for assessing the development of future risks.
The crisis has revealed serious flaws in relying solely on such an approach. This white paper focuses on the use of stress testing for proactive Risk Management beyond regulatory requirements.
Published on: February 2015
Risk Dynamics has unparalleled experience in model risk management and independent validation. We have supported financial institutions of all sizes, worldwide, since 2004.
Our focus and dedication to model risk and validation services, our independence and benchmarks, combined with our ability to provide unbiased views across regions and regulatory regimes, is unique in the market.