Insights & News
A common belief is that broader and deeper bank regulations decrease earnings and share value. Would SVB’s, SBNY’s, and FRCB’s shareholders agree?
Nine initial impressions of the Fed’s report on SVB including why we anticipate more supervision and attempts to reverse the loosening of scrutiny in 2017 – 2020.
Mayer Brown regulatory partner, Matt Bisanz, and CEO Andy Spero talk about trends and best practices for managing risk – and advice to those just starting out.
Climate Change, Extreme Weather and Loan Losses. We analyze differences in default rates, LGDs, and loss rates for mortgages in four recent and costly storms.
Since Silicon Valley Bank’s demise, many have been yapping about the importance of capital and capital ratios, but it’s never about capital. It’s always about liquidity!
Andy Spero explains what he concluded from the Fed’s discount window seemingly turning SVB away, and his thoughts on why the FDIC rushed to close SVB down.
We summarize the guidance, analyze the recent revisions, and outline the differences in the tailoring framework for CCAR Supervisory Expectations.
Recent Insights
Anticipated and Unanticipated Benefits of Loss-Forecasting
In anticipated direct events, identification and use of risk mitigants mean better preparation to reduce losses in analyzed situations: Precautions or ex ante actions that reduce the possibility of the considered situation occurring Insurance…
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Learning Opportunities from “A Christmas Story”
Learning is a benefit that is important enough to describe separately! Like much financial and credit model development, scenario analysis is research as much as development or construction. Scenario analysis leads to a better understanding of the …
Read MoreSR 12-7 and the Five Principles of Stress Testing
If CCAR/DFAST is the extent of a firm’s stress testing, then, (a) the firm does not comply with SR 12-7, particularly Principles 1 and 2, and therefore, Principle 5; (b) there are likely deficiencies in overall risk management and data governance/sys…
Read MoreCECL and the Corona Virus
ol> Review—is ongoing monitoring and includes: Feedback from internal & external constituents Back-testing, etc. It’s especially important if the original CECL models were built on “older” firm data that stopped a couple years ago or incorp…
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Does Unemployment Predict Commercial Loan Losses?
>The Short Answer: Historically, No, It’s the Other Way Around The Long Answer: let’s look at scatter plots and correlations and see the two large problems with using it. This is the third in a series of three posts. Two Regimes In our fi…
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