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  Issue 20 | Archive August 2014

RMI Hosts its Eighth Annual Risk Management Conference

The RMI’s eighth Annual Risk Management Conference attracted close to 300 participants. The annual international event brought together leading international academicians, top industry practitioners, policy makers and regulators, and was held at the Pan Pacific Singapore from the 10 to 11 July. “Risk Management Amidst Global Rebalancing” was the theme for this year’s conference as risk managers face operational rebalancing with interest rates expected to return to more normal levels in the long term.

Opened by RMI Director, Prof. Steven Kou,. the policy forum on the first day focused on the challenges of handling and assessing risk together with a panel of Chief Risk Officers discussing the increasing importance of regulatory compliance policy that they must abide.

Dr. K.C. Chakrabart, recently the Deputy Governor of the Reserve Bank of India, was the keynote speaker and he discussed the importance of lessons that we learnt from the crisis driving his message on the essence of risk. He also shared his experience of handling risk while he was a central banker. During the question and answer session, Dr. Chakrabarty engaged with the audience in a lively discussion on the developments of the financial sector.

Chief Risk Officer panel discussion was represented by Singapore Exchange Chief Risk Officer, Agnes Koh, Maybank Group Chief Risk Officer, John Lee, Clearing Corporation of India Chief Risk Officer, Siddhartha Roy, Michael Chang, Acting Head of Risk, SinoPac and was chaired by Lutfey Siddiqi, Managing Director, UBS and Adjunct Professor in RMI. They shared with the audience on the regulatory challenges and their experiences in protecting their organizations from a possible risk of deceleration against generating returns for shareholders.

Apart from risk professionals, investment and portfolio managers also gave their perspectives on balancing risk and returns in another panel discussion segment, ˇ°Navigating Risks in Emerging Marketsˇ±. The panel was chaired by Chia Woon Khien, Senior Portfolio Manager of Nikko AM Asia, with Kevin Lu, Head of Investment Solution Asia, Partners Group, Jadish Parihar, Global Head Risk of Olam International and Kelvin Tay, Regional Chief Investment Officer of UBS Wealth Management as members of the panel. The panelists gave their tips of assessing risks in emerging markets from their different perspectives.

After lunch, Prof. Duan Jin-Chuan, Cycle and Carriage Professor of Finance at NUS, Giorgio Baldassarri, Global Head of Analytic Development, S&P Capital IQ and Rajan Singenellore, Global Head of Default Risk and Valuation Group at Bloomberg presented their models of measuring risk in “The Evolution of Credit Risk Management” segment. Prof. Duan introduced Actuarial Spread in his paper to provide an avenue for risk managers to predict the CDS spread of those companies without CDS prices. With the RMI-CRI model covering over 60,000 public firms, Prof. Duan, who is also the project lead of RMI-CRI, supported the use of Actuarial Spread for risk benchmarking because these spread solely depend on the likelihood of default under the physical probability and are not influenced by risk premium and market liquidity. Meanwhile, Baldassarri and Singenellore introduced their respective models of assessing credit risks.

RMI’s partner, the International Association of Credit Portfolio Managers (IACPM) put together another two sessions in the second half of the policy forum, focusing implementing a risk appetite framework and applied issues in credit and portfolio risk management.

The second day of the conference was a scientific program that followed the format of an academic conference where concurrent sessions were devoted to the dissemination of scientific findings. Topics explored by the papers presented included “Sovereign credit risk, liquidity, and ECB intervention”, “Love for correlation, bank systemic risk taking and loan pricing in syndicated loans”, “Global Credit Risk Cycles, Lending Standards, and limits to cross border risk diversification”, and “Risk targeting and policy illusions – the Volcker rule and its preliminary effects”, among many other interesting papers. The plenary session included talks by Prof. Chris Rogers of Cambridge University and Prof. Jun Yu from the Singapore Management University, covering “What’s wrong with risk Management” and “Econometric Analysis of Bubbles and Economic Surveillance”, respectively.

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Published quarterly by Risk Management Institute, NUS
Editor: Ivy Wang (rmiwy@nus.edu.sg)