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Donald van Deventer
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Donald R. van Deventer founded the Kamakura Corporation in April, 1990 and is currently Chairman and Chief Executive Officer. Dr. van Deventer's emphasis at Kamakura Corporation is enterprise wide risk management and modern credit risk technology. The second edition of his newest book, Advanced... More
My company:
Kamakura Corporation
My blog:
Donald R. van Deventer's Kamakura Blog
My book:
Advanced Financial Risk Management, 2nd Edition 2013
  • Bank Of Communications Implements Kamakura Market Risk Solution In China 0 comments
    Jul 16, 2014 5:46 PM | about stocks: BKFCF, BCMXY

    Kamakura Corporation reported Wednesday that it had successfully completed the implementation of a market risk project with Bank of Communications, one of the largest banks in China. Established in 1908, Bank of Communication has a long history in China and is one of the first banks to have issued banknotes in modern Chinese history. It was listed on the Stock Exchanges of Hong Kong Limited and Shanghai Stock Exchange respectively in June 2005 and May 2007. Bank of Communication is amongst the top 5 commercial banks in China and has an extensive network of over 2,800 branches covering over 80 major cities. Apart from Hong Kong, the Bank has also established overseas branches in New York, Tokyo, Singapore and representative offices in London and Frankfurt.

    The project involved the generation of all market risk related metrics, including value at risk, sensitivity analyses, risk factor disaggregation, potential future exposure, and stress testing, both on a static and on a dynamic basis. It also included the full implementation of the internal models approach for regulatory reporting on market risk, including risk sensitivities and risk decomposition.

    The project comprised software implementation, subject-matter consulting, and the creation of reports specific to the bank and Central Bank requirements for both executive management and regulatory perspectives. Dr. Clement Ooi, the Managing Director of Asia Pacific Operations for Kamakura, stated, "Bank of Communications is a very advanced bank, always ahead of its peers in innovative risk management information process implementations. Their selection and implementation of Kamakura after a comprehensive vendor evaluation proves that organizations seek modular and integrated solutions wherever possible in order to minimize the use of disparate systems. This project has resulted in a very accurate assessment of the market risks of the bank, and the fact that these can be stress tested means that the organization is prepared for any adverse movements in market conditions."

    Suresh Sankaran, Managing Director and Global Head of Strategic Consulting for Kamakura, said Wednesday, "The successful implementation of the Bank of Communications market risk project is not just due to the professional approach adopted by Kamakura Corporation, but on the bank understanding the immense need for subject-matter expertise that is available with Kamakura's consulting personnel. This project has provided the bank with not just executive information on market risk metrics, but also complete regulatory compliance from a Basel II/III standpoint. It positions them well to be first adopters in the world of regulatory stress testing from a dynamic perspective in China. Kamakura Corporation has the full suite of risk management and regulatory compliance solutions including IAS39 / IFRS9, Basel II/III, Market risk, Credit risk, ALM, FTP, Liquidity Risk, Capital Management & Planning, Credit Estimation, Margin Management and Financial Accounting all through one integrated, holistic computation engine, and this certainly will be the platform upon which the bank can build its integrated risk framework."

    Mr. Liang Kui, CFA, Senior Risk Manager at Bank of Communications stated, "Our implementation of the Kamakura Market Risk module and relevant reporting structures underpinning the solution was smooth, on time, and to our satisfaction. The Kamakura consulting team is exceedingly professional and courteous, and adopted a 'no surprises' approach, which meant that both the bank and the vendor were abreast of all developments during the implementation. Furthermore, the experts were all available for use tests, and this ensured that our results were back-tested, validated, and reconciled to the satisfaction of executive management and regulators. We look forward to working closely with Kamakura Corporation to further refine our risk structures and processes in the not-too-distant future."

    Martin Zorn, President and COO for Kamakura Corporation, said Wednesday, "The successful implementation of the market risk project in Bank of Communications is important not just from an integrated risk management standpoint but also in the realm of regulatory compliance. The fact that there are other, similar projects not just in China but in the entire region is a great plus for Kamakura, and is testimony to the credentials of Kamakura's subject matter experts. Kamakura is well-positioned to meet the burgeoning regulatory demands imposed on financial institutions in the region and has the wherewithal to keep pace with regulation; as a matter of fact, what is currently being introduced as risk regulation has been available in Kamakura Risk Manager for the past ten years."

    Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: BKFCF, BCMXY
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