Firms across the board are struggling to gain a comprehensive view of their counterparty risk. In the wake of the Credit Crisis, regulators have increased their focus on pushing firms to not only better understand risk exposure, but also be able to provide evidence of the analysis they use to create their view of risk.
Entity identification has emerged as a key requirement for firms seeking to understand the links between investment securities, issuers, counterparties and risk measures. But creating entity hierarchies – which are required to link legal entities, counterparties and issuers with securities, thereby establishing beneficial ownership – remains a challenge.
Despite great strides, such as the adoption of the global legal entity identifier (LEI), firms continue to be hamstrung by data issues in their attempts to address credit and counterparty risk. The complexity of operations and reliance on multiple data sources have proven to be key factors that add layers of difficulty.
This webinar will examine the challenges associated with mapping, managing and visualizing the data sets needed to create a holistic view of market, country and counterparty risk. The panellists will discuss what data and technology are needed to address legal entity hierarchies and country of risk, using a proactive and robust approach to data mapping. This will include examples from both the buy and sell sides. Finally, the speakers will provide guidance on how to approach a top-down strategy for entity data management.
11. Identifier
Entities mapped to the most commonly
used Identifiers allowing customers
an easy way to navigate and
compare multiple datasets
Location Classifications
Location classifications, including
country of incorporation, country of
domicile and country of risk
Organization
Organization details including legal entity
name, IHS Markit ticker, business status,
and other attributes
Select Financials
Select financial statement
information from S&P Capital IQ
Corporate Hierarchy
Entities mapped to their
immediate parent and ultimate
parent including provision of
percent ownership
Industry Classifications
Sector and industry classification
including both product-based (SIC &
NAIC & NACE) and market-based
(GICS & IHS Markit) taxonomies
Instrument Mapping
Instrument exposure provided at
entity, immediate parent and
ultimate parent level
Credit Rating Data
Entity level credit rating provide at
debt type level including “outlook”
and “watch” status
Entity Reference Data
12.
13.
14.
15. Country
Hierarchies
• Links entities, counterparties and issuers with securities, establishing beneficial ownership
so firms can understand corporate hierarchies of issuers and counterparties
Visualization
• Holistic view of entity exposure across parent/child relationships, standard industry
classifications (NAIC, SIC) and country of risk
Classifications
• IHS Markit’s sector classifications as well as market-accepted NAIC and SIC
• Full set of components behind country of risk calculation – domicile, listing, revenue, country
of incorporation
22. Use Cases
Organisation Structure Portfolio Risk Management Regulatory Monitoring
Relative Value/Arbitrage Pre/Post Trade analysis Capital Structure
Risk Visualisation Exposure Classification Client Onboarding
Relative Value
Understand relative value across
the capital structure
Risk Aggregation
Aggregate exposures easily
Operational
Efficiencies
Less time collecting and
connecting, more time analyzing
Entity Data
External
Identifiers
Global
Reference Data
