This course will provide course participants with an overview of model risk management with a focus on the specific needs of banking institutions. The evolving complexity of products and activities engaged in by banks has greatly increased the reliance banks place on models, with uses ranging from risk measurement to valuation. This course will review the current regulatory requirements and best practices for managing model risk and will describe the critical success factors associated with implementing an appropriate model risk governance framework.
By the end of the course, participants will be able to:
- Describe the components of a model and give examples of models used in banks
- Identify sources of model risk
- Discuss the current regulatory guidance for model risk management at banks
- Identify key characteristics of effective model risk management
- Explain why independent review and validation is critical to controlling model risk
- Describe at a high level the necessary components of a model risk governance framework
Suggested Prerequisites: None
Program Level: Foundational
Target Audience: Anyone who wants to learn about model risk management, such as staff from compliance, middle office, legal, IT, operations, or HR, and regulators who work closely with various aspects of model risk.
Advance Preparation: None
Computers and Financial Calculators: N/A
Recommended CPE Credits: 2.4
Instructor: David Oakes
Duration: 2 hours