The conference discussed the new Guidelines on Risk Appetite Frameworks in Banks developed by Nestor Advisors. Stilpon Nestor (Managing Director), Chris Barrett (Senior Advisor) and Florian Sommer (Senior Analyst) represented the firm throughout the conference appearing on several panels. Click here for the full agenda.
Danièle Nouy, Chair of the Supervisory Committee of the Single Monitoring Mechanism (SSM) at the European Central Bank opened the conference and stressed that banks must know how much risk they can stomach and set their appetite for risk accordingly. "Naturally, this takes more than guesswork: it requires comprehensive and well-developed risk appetite frameworks. These frameworks are a core element of risk culture and risk management. Banks must take them seriously and build them with great care. With regard to Slovenia, we expect banks to focus on at least four things. First, they should concentrate on credit underwriting criteria. Second, banks should work on how they identify potential deterioration of credit risks; they must carefully monitor weak credits so they can take steps to keep the loans performing. Third, banks should ensure the proper management of collateral. Fourth, they should pinpoint concentration risks in their risk appetite statements," she emphasised.
Click here to read the Bank of Slovenia press release.