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Risk Management

Over the past two decades, risk management in financial institutions has evolved into a critical function with highly defined processes for identifying, measuring, and monitoring controls over specified risks. The broadly divergent outcomes among financial institutions weathering the recent financial crises have further highlighted the critical importance of effective risk management, moving the discipline to the top of regulatory concerns.

Promontory professionals have unrivaled knowledge of current and emerging regulatory and supervisory perspectives as well as industry best practices in risk analytics, risk governance and risk reporting. As former regulators, our professionals wrote or advised on the drafting of many key regulations.

Banks and other financial companies are required to develop and maintain current, forward-looking risk management systems, informed by the analytics needed to support sound decision-making. As experts on enterprise-wide risk management, we perform top-to-bottom reviews and provide sophisticated recommendations for better managing and controlling risk. Our reviews include evaluating the board and management’s organization for risk management oversight, ensuring that contemporary expectations for an independent risk function are being met. We also focus carefully on the core management processes by which risks in the organization are: identified and measured; controlled and monitored; tested, tracked, and remediated; and reported to governing bodies.

We have experts in all facets of risk management, including credit, interest rate, capital, liquidity, market, compliance, operational, and other risks. Each client’s circumstances are different, and our solutions are tailored to fit individual client needs. Working with management and regulators, Promontory develops comprehensive, customized and effective risk management systems, controls, and strategic analytics to help our clients deal with risks, known and unknown, and build shareholder value.

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A major government-sponsored enterprise needed to improve its enterprise-wide risk management program as part of its strategic growth initiative. Promontory assessed its current program and recommended improvements in risk management practices for major risks by reviewing the company’s risk governance framework and risk management practices. Our professionals brought the client up to industry best practices and assisted in revising its asset liability management policy.
A major U.S. financial institution reached out to Promontory after identifying deficits in its compliance risk management program that had prompted enforcement actions from both the Federal Reserve Board and the Office of the Comptroller of the Currency. Promontory reviewed compliance operations at the corporate center and several business units, compliance testing by the internal audit function, and compliance oversight by the responsible committee of the board of directors. Our reports provided the foundation for an accepted program of corrective action that included changes in personnel, processes, and controls. The institution now has a well-rated compliance program and is no longer under enforcement actions.
A global commercial banking institution based in the Asia-Pacific region called on Promontory to conduct a forensic review to identify the cause of a multibillion-dollar loss and to assess the institution’s risk management function. The institution adopted our recommendations, restructured its risk management function, strengthened board oversight, sold a major subsidiary, regained its competitive footing, and brought itself into the good graces of its previously highly critical regulator.

Risk Management

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