Credit risk poses a significant threat for banks, thrifts and many non-bank financial institutions. Successfully managing this potential exposurerequires effective execution and integration of a number of interdependent disciplines, functions and processes.

A&M can help you meet and exceed heightened regulatory expectations. Our cross-function credit risk management offerings and processes span the credit lifecycle to include:

Mortgage securitizations represent a $13.8 trillion secondary market that has fueled unintended systemic risks. Post-financial crisis, regulatory scrutiny of the mortgage banking and retail credit sector has intensified. Those responsible for managing these risks must be able to rapidly respond in this heightened regulatory environment.

Alvarez & Marsal’s Mortgage Banking and Retail Credit team applies a unique combination of operational, regulatory and quantitative analytic expertise to provide bank and non-bank clients the answers they are looking for. We develop strong risk management frameworks and control environments to achieve sustainable compliance and keep you on top of present and emerging risks.

Our professionals come from both industry and regulatory backgrounds and they understand the issues you face across the credit risk lifecycle. We help solve regulatory challenges and find ways to improve your business operations, increase efficiencies and mitigate risks.

We advise on:

Risk permeates every industry, every operational function and every aspect of business. Multi-directional Information flows across the company, among specific risk owners and up to senior management and the board which can help manage risk.

Enterprise risk management (ERM) strategies illuminate the relevancy and correlation of risk factors for business leaders and serve to inform management’s choices on related improvements. The result is a simple and sustainable system-wide view of risk that enhances value.

We use bespoke diagnostic methods and tools to assess and quantify risk, analyzing its likelihood, impact and underlying causes. Our dynamic process identifies correlations and maps how risk factors flow throughout your organization. We help you identify and implement risk-based strategies by:

• Evaluating and quantifying risk exposures to optimize and align strategies to appropriate risk tolerances
• Using analytic tools including proprietary risk analysis and modeling tools and scenario generation analysis
• Deploying easy-to-use dashboards, reports, frameworks and process flows
• Analyzing and maximizing risk capital usage and profitability

Our ERM services include:

As international regulators use stress testing models to further scrutinize banks, we develop, implement, and validate mathematical tools for enhanced management of risk, return and shareholder value, as well as improved compliance with regulatory requirements.

Stress Testing and Capital Adequacy

Model Development

Independent Review and Validation of Models

Business Improvement / Strategic Investing

In the current economic and regulatory environment, banks of all sizes and nationalities need a more focused view of their capital plans and understanding of strategic options. We serve as a partner to financial institutions around the globe.

We develop capital management and enterprise risk management programs that integrate strategy, capital, funding, risk and regulation of financial institutions and insurance companies. We also design and validate enterprise risk and capital analytics.

Our experience includes: