Risk Management, Basel III


Our clients often meet two important questions during their daily operations:

  • "Do I really understand what kinds of risks affect my operation?"
  • "Do I have the proper procedures to manage those risks?"

We firmly believe that the risk management methodologies and their implementation techniques developed by us can give the appropriate answers to these important questions.

Nevertheless, in the field of risk management there are not only questions to be answered: the regulatory framework defines certain guidelines for financial institutions which can be challenging for financial institutions to implement without experienced consultants guidance. ITCB started its Basel II capital adequacy related training and consulting work as early as 1999. As a result, we have a sound international and Hungarian knowledge basis in handling complex Basel II-related projects.

We participated in Basel II projects with most Hungarian banks, focusing on credit- and operational risk management issues. Our objective in these projects has always been to find multi-layered, practical and efficient solutions for our clients. ITCB offers the following specific services regarding such projects:

  • Professional support of the project team (overall due diligence, support in decision making, discussion of related professional issues, project management)
  • GAP analysis to analyse mismatches between the regulatory requirements and the practices of the given institution
  • Developing and validating scoring / rating systems
  • Developing and validating parameter estimation models (PD, LGD, EAD, CF)
  • Developing operational risk management systems (support in loss data collection, developing risk management procedures and AMA modelling methodology)
  • Developing and introducing ICAAP methodologies
  • Preparing and validating IRB application packages
  • Redesigning internal procedures
  • Designing and maintaining risk management reporting systems