Funds-Axis
COUNTERPARTY RISK & LIQUIDITY RISK
EFFECTIVELY MEETING THE CHALLENGE
Free Seminar, London, 30th April 2009, 9am to 1pm

COUNTERPARTY RISK & LIQUIDITY RISK
EFFECTIVELY MEETING THE CHALLENGE

FREE SEMINAR, LONDON, 30TH APRIL 2009, 9AM TO 1PM

(Registration and Coffee / Tea served from 08.30 am)

Venue: London Capital Club (details)

This is a free Funds-Axis event. To reserve your place, please email events@funds-axis.com. Also available as an in-house workshop.

Counterparty risk management has in the last number of months become an increasingly significant part of firms' business operations as concerns increase about the negative impact of default by key counterparties. As regards Liquidity Risk, the FSA has warned firms that fund suspensions are a last resort for exceptional circumstances only and that the FSA expects managers to carefully consider on an ongoing basis the liquidity profile of both their current and potential future underlying investments.

At this event, we consider the steps firms can be taking to ensure they have standardised, well documented and reliable approaches to analysing counterparty risk and fund liquidity to ensure that critical information flows in a coherent and timely manner to Risk Managers.

Course Overview

Session 1: Counterparty Risk - Scoping the Problem

We commence with a consideration of where counterparty risk arises in trading, settlement and custody processes. We look across asset classes from equities and bonds, to derivatives, money market instruments, cash and deposits and also to stock lending transactions.

Session 2: Effectively managing counterparty risk

Reflecting on Session 1, we consider the key operational and compliance process controls that organizations should have in place to ensure that counterparty risk is properly managed and not unduly assumed.

Session 3: Accurate assessment of counterparty exposure

In this session, we consider how to measure counterparty exposure on particular transactions. We consider the challenges posed by illiquid and difficult to value instruments, responses taken and the role and approach of third-party independent valuation providers to valuing such instruments. We consider approaches to calculating counterparty risk exposure, including the 3-step Banking Consolidation Directive approach.

Session 4: Case Study: Effectively automating the calculation, monitoring and reporting of counterparty risk

We consider how pre- and post-trade investment monitoring systems should be able to provide a fully automated approach to conducting consistent counterparty risk monitoring. At its best, this can encompass the aggregation of positions from across the organization, data enrichment, counterparty exposure calculation using the 3 stage BCD approach, and the taking into account of collateral and netting.

Session 5: Liquidity Management

Current levels of market illiquidity and investor redemptions are posing fresh operational challenges and fund liquidity management challenges which have not been on Managers' s agenda for some time. In this session we consider the FSA's expectations, the operational policies that Managers can introduce to help manage unitholder redemptions and we also consider how Managers can effectively monitor fund liquidity levels, compare fund liquidity to forecast redemption levels, and perform impact analysis of the effect of redemptions on the the on-going fund liquidity / remaining investors.

Funds-Axis provide extensive consultancy and training services, including in respect of derivatives, operational risk and counterparty risk. For details of our Governance, Risk and Compliance software, click here. Click here for details of our recent assignments or contact info@funds-axis.com

Funds-Axis Limited
31 Southampton Row
London, WC1B 5HJ

darren.burrows@funds-axis.com

Tel: +44 (0)800 783 67 91
Mob: +44 (0)7977 250034

Contents

Funds-Axis COUNTERPARTY RISK & LIQUIDITY RISK EFFECTIVELY MEETING THE CHALLENGE Free Seminar, London, 30th April 2009, 9am to 1pm

Funds-Axis
COUNTERPARTY RISK & LIQUIDITY RISK
EFFECTIVELY MEETING THE CHALLENGE
Free Seminar, London, 30th April 2009, 9am to 1pm