Corporate clients
For large companies with international business it is not possible to eliminate all risks, so the key is to find an acceptable risk level. It is important to analyze how exposure will be affected by various business decisions and opportunities to compensate for increased costs caused by market price changes. The latter might be achieved either through higher prices or by initiation of operational changes to reduce other costs. If the risk situation is still not suitable after operational initiatives have been taken, a company can reduce risk by using financial instruments.
Benefits of active risk management: stabilized P&L and cash flow, increased corporate value (lower risk premium and WACC), fewer deviations from forecasts and budgets, and better decision basis for strategic decisions, investments etc.
Examples of assignments:
Financial institutions
In the strategic dimension we have deep experience in devising capital allocation methodologies and in bringing forward various aspects of Asset and Liability Management. This involves choosing the correct methodology, but also the process of gaining acceptance from a company’s board and executive management.
We also work with operational areas related to risk and performance in terms of overall principles as well as methodology. This applies to the areas that drive the business of any financial institution, i.e., support for management, sales and trading departments. It also applies to middle office and risk control areas and to the underlying policy framework.
We have extensive experience in most environments, including banks, asset managers, debt managers, stockbrokers and hedge funds, as well as in-depth knowledge of major vendors of risk management and performance measurement systems.
For large companies with international business it is not possible to eliminate all risks, so the key is to find an acceptable risk level. It is important to analyze how exposure will be affected by various business decisions and opportunities to compensate for increased costs caused by market price changes. The latter might be achieved either through higher prices or by initiation of operational changes to reduce other costs. If the risk situation is still not suitable after operational initiatives have been taken, a company can reduce risk by using financial instruments.
Benefits of active risk management: stabilized P&L and cash flow, increased corporate value (lower risk premium and WACC), fewer deviations from forecasts and budgets, and better decision basis for strategic decisions, investments etc.
Examples of assignments:
- Review of FX strategy regarding group funding and foreign investments
- Creation of benchmark/follow-up procedures for an active debt manager
- New hedging policy for a large industrial company
- Customer pricing analysis based on various currency alternatives
- Evaluation of a corporate-wide risk exposure including FX, IR and commodities
- Risk policy and manuals for an energy producer's marketing and trading units
Financial institutions
In the strategic dimension we have deep experience in devising capital allocation methodologies and in bringing forward various aspects of Asset and Liability Management. This involves choosing the correct methodology, but also the process of gaining acceptance from a company’s board and executive management.
We also work with operational areas related to risk and performance in terms of overall principles as well as methodology. This applies to the areas that drive the business of any financial institution, i.e., support for management, sales and trading departments. It also applies to middle office and risk control areas and to the underlying policy framework.
We have extensive experience in most environments, including banks, asset managers, debt managers, stockbrokers and hedge funds, as well as in-depth knowledge of major vendors of risk management and performance measurement systems.