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The Role of CRO at Credit Suisee

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Presented by, Tobias Guldimann, CRO …

Presented by, Tobias Guldimann, CRO

Cass-Capco Institute Conference

April 14, 2011

Published in: Business, Technology

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  • 1. CONFIDENTIAL The role of CRO at Credit Suisse Tobias Guldimann, Chief Risk Officer April 14, 2011 Produced by: Name Surname Date: 03.11.2005 Slide 1
  • 2. The CRO role – general expectations Right mix between integration and independence – A seat at the Executive Board, direct reporting line to CEO – Independent from the Front Office Large amount of credibility – Practical business experience – Operational and management expertise Not afraid to voice own opinion and to stick to it – Keeps balance between profitability versus risk appetite – Recognizes potential reputational risks and manages them April 14, 2011 Slide 2
  • 3. Risk governanceBank Credit Suisse Board of Directors Audit Committee Risk Committee Chief Executive Officer Credit Suisse Executive Board Capital Allocation and Risk Management Committee (CARMC) ALM, Capital, Funding OpRisk & Internal Market & Credit Risks & Liquidity Controls Credit Portfolio & Reputational Risk & Risk Processes & Provisions Review Sustainability Standards Committee Committee CommitteeDivisions IB RMC AM RMC PB RMC April 14, 2011 Slide 3
  • 4. Risk Organization Divisional Regional Global278 986 373 Strategic Risk Management Credit Risk Management Risk Analysis SRM CRM and Reporting RARSRM IB SRM PB SRM AM CH EMEA APAC Amer 25 Bank Operational Market Treasury MACS1), AI2), Risk Oversight Risk BOROManagement Number of headcounts; total CRO Division: 1,662 1) Multi Asset Class Solutions 2) Alternative Investments April 14, 2011 Slide 4
  • 5. How Risk Organisation works – Japan example Safety of our employees – Family relocation programme Business continuity assessment – Office relocation plan (Osaka) – Remote access to IT systems provided Control of exposure – Liquidity risk due to operational shutdown of counterparties – Standard check of risks, i.e. credit and market exposures – Hidden risks, i.e. PB Lombard exposure or AM real estate investments April 14, 2011 Slide 5
  • 6. Elements of success for CS in risk management (1/2) Not only a question of sophisticated models and tools; it’s about the right mix of people and the governance – Strong involvement of the BoD and ExB in risk process – Balanced mix of members in the bank’s risk management committees – Clear responsibility / accountability: each risk has an owner – Concept of 3 lines of defense 1st line: Front office is ultimate risk (P&L) owner 2nd line: Independent risk organization 3rd line: Internal and external audit April 14, 2011 Slide 6
  • 7. Elements of success for CS in risk management (2/2) Intensive interaction between the ExB, BoD and Risk Committee – Detailed and honest discussion of individual risk positions at the BoD RC – Swift, consequent action on assets which were identified as exit positions Institutionalized skepticism – Know your risks, know your numbers – Business experience is key – If you don’t know, better don’t make any assumptions April 14, 2011 Slide 7
  • 8. Key organisational priorities Best-in-class risk management organisation Risk infrastructure is a high priority Be ahead of regulators, not led by regulators April 14, 2011 Slide 8
  • 9. Key regulatory topics Biggest risk today is probably regulatory risk Basel III is possible if implemented globally Contingent capital belongs to the future of banking April 14, 2011 Slide 9
  • 10. Conclusion„Understand what you are doing“ ...if you are not sure, assume that you don‘t! April 14, 2011 Slide 10
  • 11. Questions & Answers April 14, 2011 Slide 11
  • 12. April 14, 2011 Slide 12