Mindblown: a blog about philosophy.

  • 2017 – 2019 Federal Reserve and Company Run CCAR Results

    Almost four years ago, we aggregated and published the Fed’s and Companies’ 2016 CCAR results. We’re surprised by the continued interest in those nearly four-year-old numbers; so, we asked one of our analysts to generate similar graphs for 2017, 2018, and 2019. Please note that a few observations from … Continue Reading

  • Is the Third Time a Charm for Effective Risk Management?

    There’s an old curse that seems very appropriate today: “May you live in interesting times.” Indeed! With that in mind, consider both (1) an exercise of ranking hypothetical catastrophes and (2) recent history since 2001. Imagine if last year someone provided a list of ten plausible but low-possibility events that … Continue Reading

  • Q1 2020 Large Bank CECL Estimates

    There is intense curiosity about the effects of CECL on banks’ financial statements via credit reserves–the ALLL or Allowance for Loan and Lease Losses; so, we surveyed the earnings releases, investors’ presentations and 10Qs and Ks of CCAR banks—plus one more. We present the aggregated results, below, as absolute and … Continue Reading

  • Stress Testing and the Corona Virus at Risk.net Training

    Lately, our business has been CECL, CECL and more CECL, but if all goes well, Andy will present two sessions on the other type of loss forecasting at Risk.net’s Stress Testing Training in New York City on March 26 & 27. 1. Building a Stress Testing Framework If you can’t … Continue Reading

  • 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 present “Risk Appetite and Scenario Design in Stress Testing.” … Continue Reading

  • Congratulations 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, administrative assistant, Lucy, is a hardworking member of both teams. From left-to-right, Lucy and … Continue Reading

  • Spero 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 need to know about stress testing, modeling, and data governance. The WBA was formed in 2018 … Continue Reading

  • Wells, 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 poorly-designed incentive schemes and unobservant (or complicit) supervisors. We have two main points … Continue Reading

  • CCAR 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 remain on one graph–hover over it with your mouse … Continue Reading

  • What 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 time … Continue Reading

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