Insights & News
Stay updated with our latest industry perspectives and company announcements.
…or the Value of Stress Testing. Here’s a simple way to think about the benefits of bank regulation and credit risk management: they can make good times even better, delay the bad times, and help soften the blow when things get tough.
With the uncertainty and possible economic harm surrounding the recently-announced tariffs—whether they stay, disappear, reappear, or mutate—bankers face the challenge of integrating effects into CECL and stress test estimates.
It’s been fifteen years since the last long and deep downturn. Alas, periods of calm are not proof of resilience against harm, and in fact, they may obscure risks that may define the next downturn.
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.
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.
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
Spero Risk at Stress Testing: CCAR & DFAST Seminar
Next Wednesday and Thursday, June 13 and 14, Phil Chamberlain, EVP of Risk and Data Governance, and Andy Spero will present sessions at Risk.net’s two-day course in New York City, Stress Testing: CCAR & DFAST. On Wednesday, Phil will presen…
Read MoreCongratulations Lucy!
While there are similarities in approach, usually, there’s not much overlap between Spero Risk Associates (SRA) and Andy’s other job as the head track and field coach at John Carroll Catholic High School. However, our part-time, administr…
Read MoreSpero Risk – WBA Webinar Series
In conjunction with the Western Banking Association (WBA), we’re offering a series of webinars, entitled, “Crucial Resources for the Effective CRO.” The three webinars will go beyond regulations and bureaucracy to explain what you n…
Read MoreWells, Cross Selling, Incentives, et. al.
Last week’s news about Wells Fargo’s retail sales tactics provides excellent evidence that all of the required ethics and UDAAP (Unfair, Deceptive, or Abusive Acts or Practices) training to which bankers are subjected is no match for poor…
Read MoreCCAR 2016 BHC Loss Rate Graphs
The slideshow below consists of 16 graphs: eight for the SR 15-18 firms and a matching eight for the SR 15-19 firms. Each graph presents the Fed’s and the firm’s forecasted average loss rate for each portfolio. To stop the show–to r…
Read MoreWhat Are the Differences between SR 15-18 and SR 15-19?
March 16, 2023 Update: We have a revised version: SR 15-18 vs SR 15-19 vs HCR – Spero Risk Associates, which describes the current application of the guidance by the four tiers, i.e., I, II, III, and IV. We plan to further refine the new post as our …
Read MorePredictions, Forecasts and the Value of Scenario Analysis
According to the The Wall Street Journal, “In Uncertain Times, CEOs Lose Faith in Forecasts” and “CEOs Put Less Stock in Predictions,” which is the title of an abbreviated article in the July 13, print edition. The authors sta…
Read MoreThe High Cost of Stress Test Consulting
The Wall Street Journal reported today that banks spent about $29 billion on consultants last year, and that much of the total was spent on stress tests in the U.S. and abroad. We're not sure whether either the reported total or the portion spent on …
Read MoreBrexit, SR-12-7 and SR-11-7
Now that’s a sexy title… but only to a small audience interested in scenario analysis (stress testing) and model risk.1 During the past week, many analysts have written and commented about the Brexit vote and its implications. We are inte…
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