Knowledge base  ERM

View all AML - CDD - KYC Artificial Intelligence Basel Brexit ERM GDPR Governance - Behavioral Risk - Soft Controls Insurance MiFID Security 


Lockdown or Knock-out? COVID-19: Are we going to play Russian roulette now?

01 July 2020
Knowledge Base

by Michel Klompmaker

We have decided to publish a series of articles entitled “Lockdown or Knock-out?” on this platform. We will discuss and comment on the current measures taken by the various governments, economic forecasts from experts and expectations of politicians from the perspective of risk & compliance. We are just going to start and as long as there is no vaccine for the coronavirus, we will regularly discuss the issues that are worthwhile. Today we start with the recent news about lending to business customers in the Netherlands. On the one hand, we see a decrease in the number of infections and deaths, but what does this actually mean for the economy if we put it in a somewhat broader perspective? Is there reason for optimism? We would like to spread the optimistic sound, but we cannot ignore the facts and that they are not good. Did circumstances leave no other choice or have the banks and the responsible minister switched to a form of Russian roulette? ING announced yesterday that it expects to triple the number of bankruptcies in the Netherlands next year. And in the meantime, since the outbreak of the corona crisis, the Dutch banking sector has provided additional credit of around EUR 14 billion. As a result, the percentage of gross national product corporate debt (IMF source) has risen again to over 150 percent. For the critical down-to-earth reviews, who like to make dismissive statements about the financial policy of the so called “garlic countries”: Italian corporate debts are in percentage at over 60 percent of the gross national product. Continue reading…

Mitigating risks and increasing resilience towards infectious diseases

15 May 2020
Knowledge Base

Past events in history have shown that another pandemic may come about some time in the near future. However, there are measures that can be taken to reduce the risks as stated by a newspaper by the Institute of Economic Affairs. As the human population continues to increase, so too will viruses and diseases. Today, there are quite a few outbreaks that have remained and settled permanently among humans, though they have not quite reached the extent of the Covid-19 pandemic. However, when comparing Covid-19 to other major viruses and diseases that have spread, it is relatively moderate. Adding on to a growing population, economic integration, long supply chains, traveling and a change in how health care systems are operated and structured have all made the impact of an infectious disease significantly greater compared to 50-60 years ago. Continue reading…

Practical steps to ensure a bank’s business continuity during a pandemic

21 April 2020
Knowledge Base

by Sandra Galletti & Dr. Steven Goldman

This article identifies some strategies and recommendations that banks can utilize to minimize the impact on bank operations of the Covid-19 pandemic. A pandemic* (1) is a very particular and very terrible type of crisis. Unlike other crises such as earthquakes or cyberattacks which impact the bank’s infrastructure, pandemics directly impact its people – employees, vendors, suppliers – who might be unable to perform their jobs. Furthermore, customers cannot do business in usual ways. Unlike other crises such as technological breakdowns or security threats to which there is a reasonable expectation of resolution within a certain time frame, a pandemic’s duration can be prolonged; its severity brutal. Continue reading…

The impact of the Covid-19 virus on airlines

15 April 2020
Knowledge Base

It is clear that one of the most severely affected sectors is the global aviation sector. How will this go and how far will the government’s financial aid go to keep the strategically important airlines figuratively and literally in the air? Not to mention the measures that are likely to come our way. A valid passport and a paid flight ticket will no longer be a guarantee that you can get on board a flight. And will half of the passenger seats disappear to the cargo hold soon? Food for thought for trend watchers, doomsday prophets and economists, but for now the hard reality is that about 90 percent of the fleet of many airlines is parked neatly on the ground. We will go through the situation with you of any airline we know, KLM, but what is mentioned below may apply to any other airline. Continue reading…

Photo: https://pixabay.com/

Introductory statement by the ECB

13 September 2019
Knowledge Base

ECB’s President Mario Draghi and Vice President Luis de Guindos announced that: “Based on our regular economic and monetary analyses we have conducted a thorough assessment of the economic and inflation outlook, also taking into account the latest staff macroeconomic projections for the euro area. As a result, the Governing Council took five decisions in pursuit of its price stability objective.”

Continue reading…

Photo: https://pixabay.com

How to signal the future path of interest rates? The international evidence on forward guidance

05 August 2019
Knowledge Base

Forward guidance, i.e. communication by a central bank about the likely future path of interest rates, usually reduces uncertainty. But it matters how this is done in practice, because forward guidance with a short time horizon can raise uncertainty. This occurs if the forward guidance impairs the aggregation of private information in financial markets, thus making market prices less informative. Central banks often make statements about the likely future path of interest rates by providing so-called forward guidance. Forward guidance is especially used if the central bank can no longer cut policy rates because they are already as low as possible (i.e. they have reached their lower bound). Continue reading…

Many Financial Institutions Not Using Operational Risk Management To Challenge Business Models: KPMG And RMA Survey

05 December 2018
Knowledge Base

Aligning operational risk management (ORM) with strategy could enable strategic change, improve business performance and enhance customers’ experience for financial institutions. However, only half of firms surveyed with less than $250 billion in assets leverage ORM to challenge business models, according to a report by KPMG LLP and The Risk Management Association (RMA).
Continue reading…

Photo: https://pixabay.com/

All the information in the file of a financial supervision authority is not necessarily confidential

24 August 2018
Knowledge Base

Information which might constitute business secrets loses, generally, its secrecy when it is at least five years old Mr Ewald Baumeister is one of the investors who suffered loss due to the activities of the German company Phoenix Kapitaldienst, whose business model took the form of a Ponzi scheme. Insolvency proceedings having been initiated against Phoenix in the course of 2005 that company has been dissolved and is now in judicial liquidation.
Continue reading…

Listed issuers must focus on new IFRS standards in 2017 annual financial reports

07 November 2017
Knowledge Base

The European Securities and Markets Authority (ESMA) published the priorities to be considered by listed companies, and their auditors, when preparing and auditing their 2017 financial statements. These priorities are set out in the annual Public Statement on European Common Enforcement Priorities (Statement), through which ESMA promotes the consistent application of the International Financial Reporting Standards (IFRS).
Continue reading…