You are previewing Foundations of Financial Risk: An Overview of Financial Risk and Risk-based Financial Regulation, 2nd Edition.
O'Reilly logo
Foundations of Financial Risk: An Overview of Financial Risk and Risk-based Financial Regulation, 2nd Edition

Book Description

Gain a deeper understanding of the issues surrounding financial risk and regulation

Foundations of Financial Risk details the various risks, regulations, and supervisory requirements institutions face in today's economic and regulatory environment. Written by the experts at the Global Association of Risk Professionals (GARP), this book represents an update to GARP's original publication, Foundations of Banking Risk. You'll learn the terminology and basic concepts surrounding global financial risk and regulation, and develop an understanding of the methods used to measure and manage market, credit, and operational risk. Coverage includes traded market risk and regulation, treasury risk and regulation, and much more, including brand new coverage of risk management for insurance companies. Clear explanations, focused discussion, and comprehensive relevancy make this book an ideal resource for an introduction to risk management.

The textbook provides an understanding of risk management methodologies, governance structures for risk management in financial institutions and the regulatory requirements dictated by the Basel Committee on Banking Supervision. It provides thorough coverage of the issues surrounding financial risk, giving you a solid knowledgebase and a practical, applicable understanding.

  • Understand risk measurement and management

  • Learn how minimum capital requirements are regulated

  • Explore all aspects of financial institution regulation and disclosure

  • Master the terminology of global risk and regulation

  • Financial institutions and supervisors around the world are increasingly recognizing how vital sound risk management practices are to both individual firms and the capital markets system as a whole. Savvy professionals recognize the need for authoritative and comprehensive training, and Foundations of Financial Risk delivers with expert-led education for those new to risk management.

    Table of Contents

    1. Preface
    2. Acknowledgments
    3. Introduction
    4. CHAPTER 1 Functions and Forms of Banking
      1. 1.1 Banks and Banking
      2. 1.2 Different Bank Types
      3. 1.3 Banking Risks
      4. 1.4 Forces Shaping the Banking Industry
    5. CHAPTER 2 Managing Banks
      1. 2.1 Balance Sheet and Income Statement
      2. 2.2 Loan Losses
      3. 2.3 Asset and Liability Management
      4. 2.4 Corporate Governance
      5. Notes
    6. CHAPTER 3 Banking Regulation
      1. 3.1 The Evolution of Risk Regulation in Banking
      2. 3.2 Foundations of Bank Regulation
      3. 3.3 International Regulation of Bank Risks
      4. 3.4 Deposit Insurance
      5. Notes
    7. CHAPTER 4 Credit Risk
      1. 4.1 Introduction to Credit Risk
      2. 4.2 Lenders
      3. 4.3 Borrowers
      4. 4.4 Characteristics of Credit Products
      5. 4.5 Types of Credit Products
      6. 4.6 The Credit Process
      7. 4.7 The Credit Analysis Process
      8. 4.8 Information Sources
      9. Notes
    8. CHAPTER 5 Credit Risk Management
      1. 5.1 Portfolio Management
      2. 5.2 Techniques to Reduce Portfolio Risk
      3. 5.3 Portfolio Credit Risk Models
      4. 5.4 Credit Monitoring
      5. 5.5 Credit Rating Agencies
      6. 5.6 Alternative Credit Risk Assessment Tools
      7. 5.7 Early Warning Signals
      8. 5.8 Remedial Management
      9. 5.9 Managing Default
      10. 5.10 Practical Implications of the Default Process
      11. 5.11 Credit Risk and the Basel Accords
    9. CHAPTER 6 Market Risk
      1. 6.1 Introduction to Market Risk
      2. 6.2 Basics of Financial Instruments
      3. 6.3 Trading
      4. 6.4 Market Risk Measurement and Management
      5. 6.5 Market Risk Regulation
      6. Notes
    10. CHAPTER 7 Operational Risk
      1. 7.1 What Is Operational Risk?
      2. 7.2 Operational Risk Events
      3. 7.3 Operational Loss Events
      4. 7.4 Operational Risk Management
      5. 7.5 Basel II and Operational Risk
      6. Notes
    11. CHAPTER 8 Regulatory Capital and Supervision
      1. 8.1 Pillar 1—Bank Regulatory Capital
      2. 8.2 Types of Bank Regulatory Capital under Basel II
      3. 8.3 Bank Capital under Basel III
      4. 8.4 Pillar 2—Supervisory Review
      5. 8.5 Pillar 3—Market Discipline
      6. 8.6 International Cooperation
      7. 8.7 Beyond Regulatory Capital
    12. CHAPTER 9 Insurance Risk
      1. 9.1 Introduction to the Insurance Industry
      2. 9.2 Property and Casualty Insurance
      3. 9.3 Life Insurance
      4. 9.4 Reinsurance
      5. 9.5 Other Types of Risk
      6. 9.6 Regulation and Supervision—Solvency 2 in the European Union
      7. 9.7 The Role of Lloyd's of London
      8. 9.8 Summary
    13. Glossary
    14. Index
    15. EULA