Financial Institutions Risk Management in Czech Republic: A Growing Concern
As the financial landscape continues to evolve, risk management has become a critical aspect of operations for banks and financial institutions in the Czech Republic. With increasing regulatory requirements and market volatility, it’s essential for these institutions to have robust risk management systems in place to protect their capital and liquidity.
Risk Management Challenges
- Increasing regulatory requirements
- Market volatility
- Need for robust risk management systems to protect capital and liquidity
PwC’s Expert Advisory Services
To address the challenge of risk management, PwC’s Financial Risk Management team provides expert advisory services to financial institutions in the CEE region, including the Czech Republic. Our team focuses on the qualitative aspects of risk management, covering both financial risks such as market risk and credit risk, as well as non-financial risks like operational risk.
Services
- Benchmarking current risk management processes against “leading market practice”
- Identifying improvement opportunities
- Designing tailored solutions
- Working closely with local PwC offices to deliver services that cater to the specific needs of Risk Management teams, Treasury departments, or Internal Audit functions
Specialized Expertise
One area where we have gained significant expertise is in credit risk control processes within the Asset Quality Review (AQR) under the European Central Bank (ECB). As the Centre of Excellence for AQR within PwC EMEA, we have successfully implemented projects in the CEE region, the euro area, and beyond.
Services Covering a Wide Range of Topics
- ECB Asset Quality Review and preparation projects
- Data integrity validation
- Capital management
- Liquidity management
- Market risk management
- Credit risk management
- Operational risk management
- Risk management culture and governance, including Risk Appetite Framework
- Governance setting for data aggregation and reporting in risk management processes
- Resolution and Recovery Planning
Technical Expertise
In addition to our advisory services, PwC’s Financial Risk Modelling team provides technical expertise in quantitative risk management. Our consultants have extensive experience in developing, validating, or auditing a wide range of market and credit risk models.
Services
- Statistical model development
- Model validation
- Stress testing
- ESG modelling
- Credit quality scoring, risk-based pricing, loan provision strategy
- NPL and collection process
- Allowances according to IFRS 9/US GAAP
- IRB-A/IRB-F models according to CRR
- CCAR/DFAST models
Valuation Services
We also offer valuation services for complex derivatives and provide expertise in risk management and modelling.
Conclusion
In today’s fast-paced financial landscape, it’s essential for banks and financial institutions in the Czech Republic to stay ahead of the curve when it comes to risk management. With PwC’s Financial Risk Management and Modelling teams on your side, you can rest assured that you’re well-equipped to navigate the complexities of risk management and drive long-term success.