It is imperative that market players and regulators reflect on reviewing risk management practices. I am therefore confident that the local experiences to be shared tonight and the international experiences to be gleaned will only serve to enrich this discourse. The Central Bank, can share the perspectives on Risk Management from a regulator’s viewpoint.
These days, the large, internationally active banks, in particular, are switching more and more to the “originate-to-distribute” model – in other words, they pool credit risks and sell them on – often to investors outside the banking system. By passing on credit risk, banks create additional scope for new lending.