{"id":10506,"date":"2023-08-31T14:32:15","date_gmt":"2023-08-31T14:32:15","guid":{"rendered":"https:\/\/gd2.earrow.net\/ibslweb\/?post_type=lp_course&#038;p=10506"},"modified":"2025-04-09T06:54:06","modified_gmt":"2025-04-09T06:54:06","slug":"seminar-on-how-banks-and-financial-institutions-should-manage-market-risks","status":"publish","type":"lp_course","link":"https:\/\/www.ibsl.lk\/?lp_course=seminar-on-how-banks-and-financial-institutions-should-manage-market-risks","title":{"rendered":"Seminar <span style=\"text-transform:lowercase\">on<\/span> How Banks &#038; Financial Institutions should Manage Market Risks"},"content":{"rendered":"<p><strong>Conventional Sources of Market Risks<\/strong><\/p>\n<ul>\n<li>Equity<\/li>\n<li>Currency<\/li>\n<li>Interest Rates<\/li>\n<li>Commodity<\/li>\n<li>Real Estate<\/li>\n<li>Asset Bubbles<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><strong>Impact of Market Risk on Banks and Financial Institutions<\/strong><\/p>\n<ul>\n<li>Sourcing of liquidity risk<\/li>\n<li>Asset bubble bursts (value of own investments and loan collaterals)<\/li>\n<li>Credit risk\/Loan default due to asset value losses<\/li>\n<li>Losses on speculative trade\/asset positions<\/li>\n<li>Insolvency due to large losses<\/li>\n<li>Credibility risk (due to rogue trading)<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><strong>Market Risk Assessment Models<\/strong><\/p>\n<ul>\n<li>Interest gap analysis<\/li>\n<li>Yield curve and interest margin on banking book<\/li>\n<li>Value at Risk (VaR)<\/li>\n<li>Asset positions\/concentrations<\/li>\n<li>Income\/profit composition (banking book and trading book)<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><strong>Market Risk Management Systems<\/strong><\/p>\n<ul>\n<li>Regulations: Maximum limits on positions (equity and forex), haircuts on collaterals (for provisioning), Volker Rule (restrictions on proprietary trading for US banks), loan-to-value ratios (limiting exposure to asset value), capital charge (risk-weighting and minimum capital &#8211; Basel III) and prohibition of insider dealings and market manipulations<\/li>\n<li>Financial accounting: Financial Instruments &#8211; Measurement and Recognition (IFRS 9)<\/li>\n<li>Portfolio diversification strategies<\/li>\n<li>Front Office, Middle Office and Back Office arrangement for securities trading<\/li>\n<li>Limits on bank positions and dealer positions<\/li>\n<li>Internal controls (preventing fraud and breaches)<\/li>\n<li>Hedging through Derivatives (swaps, futures, options)<\/li>\n<li>Governance: Integrated risk management committee and MIS<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<h5><b>Commencement<\/b><\/h5>\n","protected":false},"featured_media":10751,"comment_status":"closed","ping_status":"closed","template":"","course_category":[],"course_tag":[],"class_list":["post-10506","lp_course","type-lp_course","status-publish","has-post-thumbnail","hentry","course"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=\/wp\/v2\/lp_course\/10506","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=\/wp\/v2\/lp_course"}],"about":[{"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=\/wp\/v2\/types\/lp_course"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10506"}],"version-history":[{"count":1,"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=\/wp\/v2\/lp_course\/10506\/revisions"}],"predecessor-version":[{"id":17673,"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=\/wp\/v2\/lp_course\/10506\/revisions\/17673"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=\/wp\/v2\/media\/10751"}],"wp:attachment":[{"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10506"}],"wp:term":[{"taxonomy":"course_category","embeddable":true,"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=%2Fwp%2Fv2%2Fcourse_category&post=10506"},{"taxonomy":"course_tag","embeddable":true,"href":"https:\/\/www.ibsl.lk\/index.php?rest_route=%2Fwp%2Fv2%2Fcourse_tag&post=10506"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}