* "Banks should take into consideration potential future changes in economic conditions when assessing individual credits and their credit portfolios, and should assess their credit risk exposures under stressful conditions."
* "The recent disturbances in Asia and Russia illustrate how close linkages among emerging markets under stress conditions and previously undetected correlations between market and credit risks, as well as between those risks and liquidity risk, can produce widespread losses."
* "Effective stress testing which takes account of business or product cycle effects is one approach to incorporating into credit decisions a fuller understanding of a borrower's credit risk."
Written for professionals in financial services with responsibility for IT and risk measurement, management, and modeling, Dimitris Chorafas explains in clear language the testing methodology necessary for risk control to meet Basel II requirements. Stress testing is the core focus of the book, covering stress analysis and the use of scenarios, models, drills, benchmarking, backtesting, and post-mortems, creditworthiness, wrong way risk and statistical inference, probability of default, loss given default and exposure at default, stress testing expected losses, correlation coefficients, and unexpected losses, stress testing related to market discipline and control action, and pillars 2 and 3 of Basel II.
* Written in clear, straightforward style with numerous practical examples
* Based on five years of development and research
* Focuses on stress probability of default, stress loss given default, stsress exposure at default
Bondholder’s options, risks and rewards in making investments in debt instruments;
The dynamics of inflation, and how they affect both trading in the bond market, and investment decisions; and
The democratization of lending, socialization of risk, and effect of the global economy on the bond market.
Financial expert Dimitris Chorafas discusses these issues in straightforward language for managers and professionals in commercial banks, securities houses, financial services companies, merchandising firms, manufacturing companies, and consulting firms, placing the mathematical treatment of the issues in the appendices, available for study but not necessary for understanding the business issues addressed in the book. Focuses on new issues of central importance in bond and debt trading today
Uses clear, straightforward language for managers and professionals in business and industry, with mathematical treatment provided in appendices
Thorough treatment of operational risk new to books on this topic
This book presents the growth and development of international banking and the role of large multinational banks in financial markets. It also presents the numerous types of foreign banking presence a bank can choose when it decides to go international. A description of the important banking centers is also covered. Issues pertaining to the regulation of international banking are elucidated in detail along with the impact of numerous U.S. laws on the operation of U.S. multinational banks. Specific operational issues such as foreign exchange management, the use of standard derivatives such as swaps and options, along with numerous financial engineering and risk management techniques are presented.
Among other things the book covers country risk assessment, other multinational banking services, project financing, syndicated loans, and is part of the activities of many multinational banks. Furthermore, international institutions such as the Export-Import Bank, The World Bank, The International Monetary Fund, and the Bank for International Settlements, are described and their role in international finance and banking is explained. Finally, the book looks at likely future issues that will affect and influence the field of international banking. In particular, the advent of new competition, legislation, and financial instruments are analyzed.
The book provides:
* comprehensive coverage of the evolution of the banking industry with Basel II in mind
* extensive information on the capital requirements for bank liquidity and solvency
* coverage of the new rules as laid down by the supervisory authorities of the Group of Ten industrialized nations
* key information on the technical requirements for credit institutions such as: new credit rating scales, modeling of credit risk, control of operational risks, and, novel ways and means for the management of exposure to Credit Risk
* Basel II accords must be implemented by 2006 and require 2 years preparation for proper implementation
* Author at the forefront in the development of the Basel II Capital Adequacy Accord
* Based on intensive research in the US, UK and continental Europe
This book covers:
*Who the major players in the syndication loan market are
*Why syndication loans are used
*Syndication loan structures and documentation
*Secondary syndication loan market
*Inspired from the basic entry level training courses that have been developed by major international banks worldwide.
*Will enable MSc Finance students, MBA students and those already in the finance profession to gain an understanding of the basic information and principles underlying the topic under discussion
*Questions with answers, study topics, practical "real world" examples and text with an extensive bibliography and references ensure learning outcomes can be immediately applied