The impact of a strong Model Risk Management approach

We advise our clients on improving their Model Risk Management and validation practices, supporting them in designing or upgrading their Model Risk Management frameworks across all lines of defence. We enable them to control and clearly communicate on their model risk exposure, and to demonstrate compliance to regulatory requirements, across jurisdictions, in the most efficient manner possible.

Model Risk Management SERVICES

What is Model Risk Management ?

Model Risk Management addresses a relatively new risk that has risen through the increased use of mathematical and statistical models in financial institutions and large corporations. Model risk comes from potential issues in the design, implementation or use of a model. In particular, it occurs when decisions rely on the model outcomes without a proper understanding of their limitations. When such issues materialise, companies can face losses ranging in the millions (even billions). Model Risk Management consists of steering the exposure to that risk by implementing a robust control framework aimed at identifying, assessing and mitigating model risk, consistently across the institution.

Since 2004, Risk Dynamics has supported banks, insurers, asset managers and market infrastructure operators in setting up and improving their Model Risk Management frameworks. We have supported companies in defining and deploying Model Risk Management and validation policies and all of their related standards. In particular, we have composed model development and validation guidelines for all types of risks and models, supported institutions in designing and implementing their model inventory, defined methodologies to address model tiering, managed conservatism layers and risk appetite, supported the optimisation and automation of models development and validation processes, designed reports and dashboards for senior management and supervisors, etc.

Model Risk Management SERVICES

What we have done?

How we do it?

We have refined over the years our model risk mangement framework and related toolkit, ensuring that they can be efficiently tailored to client needs.

Case Studies

We embrace our mission to bring each client the best service

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A comprehensive review of P&L stress testing models
Banking
Big data meets CRE credit risk modelling
Banking
Validating credit risk models helps a global bank improve operating model
Banking
Assessing a global bank’s recovery and resolution plan financial aggregator
Banking
Full scope validation of an initial margin model
FMI
An in-depth review of a model developed by a large Asia/Pacific bank moving from TSA to AMA
Banking
Developing and reviewing multiple sets of validation guidelines for a large bank in Europe
Banking
Validation of the Liquidity Risk Management Framework of a European Central Counterparty
FMI

Our Management Team

Bernhard-Babel.png

Bernhard Babel

Managing Director

Brussels

Area: Banking

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Marc Taymans

Managing Partner

Brussels

Area: North America

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Marie-Paule Laurent

Managing Partner

Brussels

Area: Regulators

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Roel Van den Heuvel

Associate Partner

London

Area: Insurance

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Frédéric Van Weyenbergh

Associate Partner

Brussels

Area: Continental Europe

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Thomas Wallace

Associate Partner

London

Area: UKI

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Andreas Raggl

Managing Partner

Zurich

Area: Asset Management, APAC, Middle East, Africa, Latin America

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