Treasury, Liquidity – Capital Risk Management

As a fully integrated risk practice, we have the size and capability to address all risk issues and deliver end-to-end solutions

Treasury Risk is the risk associated with the management of an enterprise's holdings – ranging from money market instruments through to equities trading.

Liquidity and Capital Risk is generally defined as the risk associated with an enterprise's ability to convert an asset or security into cash to prevent a loss. Capital risk is generally defined as an enterprise's access to cash at any given time and balancing this with its efficient use.

Treasury, Liquidity – Capital Risk Management: Value

Improved product pricing through granular measurement of funding and liquidity costs of individual transactions / products.
Optimising financial performance through a reduction in the cost of capital.
Development of a clear strategic role for treasury, ensuring the mitigation of risk in line with risk appetite through the strategic redesign of treasury policy and Ensuring treasury policy and controls.

Treasury, Liquidity – Capital Risk Management: Core Services

Enhanced Risk Strategies Frameworks

Create the right risk strategies to achieve the enterprises strategic aims and implements the optimum frameworks to ensure risk is appropriately managed.

Work Undertaken

Assessment, design and implementation of treasury, liquidity and capital risk management frameworks
Assessment, design and implementation of Risk Appetite Statements
Capital business strategy
Capital structuring
Funding and liquidity management organisation, oversight and governance
Allocation of funding and liquidity costs
Funding and liquidity planning
Liquidity systems and infrastructure

Example

Assisted a major bank review its liquidity and funding management framework in view of forthcoming regulatory change.

Enhanced Risk Performance

Putting words into action – delivering risk performance within agreed tolerances at the sharp end – day after day.

Work Undertaken

Funding and liquidity risk identification and assessment
Determining an optimal funding profile and level of liquidity
Risk capital reserving (non-FS & FS)
Capital risk assessment and planning
Capital management oversight and governance
Determining an optimal level of capital
Capital Stress testing
Capital allocation
Liquidity Stress testing
Product design
Capital structure and debt sourcing
Treasury reporting
Mergers and Acquisition assistance
Compliance and performance assessments carried out on behalf of a regulator.

Example

Supported the Australian operations of a global bank in updating their liquidity contingency plan. Additionally we assessed the implications of Basel III liquidity regulation for their local business model.

Enhanced Risk Management Functions Capabilities

Create the optimum organisational solutions and equips the enterprise with the right skills and capabilities to manage risk to achieve strategic aims.