Data Strategy: The Foundation Of Superior Risk Management
Posted: 8 September 2011
The series of financial crises beginning in August 2007 is having a profound effect on how financial institutions approach the challenge of identifying, measuring and mitigating risk.
The emergence of vast complex financial conglomerates since the deregulation of the 1980s, successive waves of financial innovation and massive international capital flows created volatile market conditions in which massive losses were sustained and major institutions failed. In view of the disruption caused by the crisis and the transfer of private liabilities to governments and taxpayers, the viability of the prevailing financial system is being fundamentally re-evaluated. To many observers, established financial risk management approaches failed to act as a brake on the build-up of excess leverage and opaque exposures which ultimately led to disaster.