regulation

Shifting Energy Markets

How are strategic priorities in energy markets shifting? What are the risk management implications? “Geopolitical risks have worsened and technological innovation is causing more disruption,” said Medy Agami, senior partner and vice-chairman at Ben-Roz and Associates and co-founder of the consulting firm Opimas. He was the sole presenter of the webinar “Energy Market Strategy and Risk Playbook: How to prosper amid a wave of disruptive innovation, geopolitical uncertainty, market volatility & exponentially growing risk landscape in 2018 & beyond” sponsored by the Global Association of Risk Professionals (GARP) on August 7, 2018. “There are five main forces acting on fundamentally shifting markets,” […]

Recent SEC Enforcement

Given the trends that are emerging for enforcement by the U.S. Securities and Exchange Commission (SEC), what’s a risk manager to do? “Risk managers should use data and data analytics to identify patterns,” said Steven Hilfer, Managing Director in the Disputes & Investigations practice, Capital Markets at Navigant. He was the fourth and final speaker in a four-part webinar panel titled “SEC 2018 Enforcement Trends” sponsored by the Global Association of Risk Professionals (GARP) on July 25, 2018. He argued that the SEC is plunging ahead in the area of data analytics, and it expects companies “to identify patterns prior to being […]

Supreme Court’s Impact

The U.S. Supreme Court will have a significant effect on the interpretation and enforcement of rules at the U.S. Securities and Exchange Commission (SEC) , according to Thomas Zaccaro, Partner, Litigation Department, Paul Hastings LLP. He was the third speaker in a four-part webinar panel titled “SEC 2018 Enforcement Trends” sponsored by the Global Association of Risk Professionals (GARP) on July 25, 2018. “The disgorgement remedies are now limited to five years,” Zaccaro said. This is as a result of the Kokesh vs. SEC case. Disgorgement refers to the act of giving up something (such as profits illegally obtained). Previously the time […]

An Insider’s View

“Quite frankly, I think some have underestimated Clayton,” said Ken Joseph, Managing Director, Disputes and Investigations practice, at Duff & Phelps. “There is a de-emphasis on some areas and re-prioritization of other areas—but he is still focused on wrongdoing.” Joseph was referring to Jay Clayton, the recently appointed chair of the U.S. Securities and Exchange Commission (SEC). Ken Joseph was the second speaker in a four-part webinar panel titled “SEC 2018 Enforcement Trends” sponsored by the Global Association of Risk Professionals (GARP) on July 25, 2018. He is also former Head of the Securities and Exchange Commission’s New York Regional Office Investment […]

A New Landscape

Jay Clayton, the recently appointed chair of the U.S. Securities and Exchange Commission (SEC) under President Trump, has signaled new directions in the enforcement of securities laws. What are the implications for financial risk managers? “There is shift away from ‘broken windows’—trying the smallest cases—and there is no longer a requirement for companies to admit wrongdoing,” said Amy Poster, Managing Principal at Alpha Pacific Strategies. She was the moderator and opening speaker in a four-part webinar panel titled “SEC 2018 Enforcement Trends” sponsored by the Global Association of Risk Professionals (GARP) on July 25, 2018. The SEC appears to be changing its […]

Consolidated Audit Trail

The eighth anniversary of the 2010 flash crash on May 6, 2010, is approaching, Beau Alexander reminded the audience at the webinar organized by the Global Association of Risk Professionals (GARP). Alexander is a Senior Sales Executive at FIS Global Trading, a publicly traded provider of financial services technology. The 2010 flash crash “was the second-largest intra-day swing in the stock market,” he said. That day the market lost two trillion dollars and then rebounded. “When you see volumes drop by 15 percent, there’s an activity that needs to be flushed out.” “Someone sitting in their parents’ basement had caused […]

As Fast as You Can

The implementation window for the new Current Expected Credit Loss (CECL) standard may seem plenty big enough, but there are loads of decisions to be made, such as “how will we calculate this?” “Decide on methodology and start implementing as fast as you can,” advised Masha Muzyka, Senior Director, Regulatory and Accounting Solutions at Moody’s Analytics. She was part of a round-table discussion, held on January 10, 2018, about the transition to CECL. The webcast was organized by the Global Association of Risk Professionals (GARP). The new CECL standard will bring significant changes, such as a spike in earnings volatility. […]

Challenges to modelling

Modelling the Current Expected Credit Loss (CECL) may present problems to some banks. Possibly a bank is collecting data for annualized charge-off rates and “how would that inform someone as to the loss rate over the lifetime of the portfolio?” asked Michael Gullette, SVP, Tax and Accounting at the American Bankers Association. The question is whether a bank has enough data of the right kind to see trends and relationships. “And if you have the data, what is the quality?” Gullette said. He was part of a round-table discussion about the transition to CECL that was webcast by the Global […]

Never too early to start

The “reasonable and supportable” clause of the new Current Expected Credit Loss (CECL) standard “is the most hotly debated part” of the regulation, according to Cristian deRitis, Senior Director, Consumer Credit Analytics at Moody’s Analytics. He was part of a round-table discussion about the transition to CECL that was webcast by the Global Association of Risk Professionals (GARP) on January 10, 2018. CECL is the new credit impairment standard under Financial Accounting Standards Board (FASB). “Auditors are grappling with what ‘reasonable and supportable’ means, too,” he added. For best practice in terms of modelling credit risk, the phrase boils down to whether […]

Lower Bond Trading Costs

As the fixed income market evolves, what are the challenges and general directions of transaction cost analysis (TCA)? How can bond investors spend their money more wisely? “The same kind of conversation we used to have with equity dealers … can now occur with fixed income dealers. That means competition will drive down transaction costs,” said Henry Marigliano, Director at FIS Global Trading. FIS is an international provider of financial services technology. He was the was the first of two panellists discussing fixed income transaction cost analysis at a webinar sponsored by the Global Association of Risk Professionals on December […]