Setting Counterparty Limits: Balancing Risk And Opportunity In Interbank Dealings

Setting Counterparty Limits: Balancing Risk And Opportunity In Interbank Dealings

Rationale

This programme equips participants with the skills to assess key factors, strategies, and risk metrics for setting effective counterparty limits.

It empowers banks to safeguard exposures, strengthen relationships, and enhance resilience in interbank dealings.

 Learning Objectives

• Identify key factors and metrics that shape counterparty limit decisions.
• Apply practical strategies to balance risk, exposure, and opportunity in interbank dealings.
• Demonstrate how to set and adjust limits to safeguard institutional resilience.
• Evaluate counterparty risks to strengthen decision-making and regulatory compliance.

Course Contents

•  Counterparty Risk in Treasury Context
• Basel guidance on credit exposure and counterparty risk
• Credit ratings, probability of default, and expected loss
• Designing and Structuring Counterparty Limits
• Aligning counterparty limits with business strategy and profitability
• Liquidity, funding, and collateral considerations.
• Escalation, breach protocols, and remediation measures
•  Periodic reassessment and recalibration of limits
•  Case study analysis of counterparty breaches in global/regional banks
•  Developing a draft counterparty limit framework and presentation.

 Learning Outcomes

• Set and adjust counterparty limits using risk-based metrics.
• Apply strategies that balance exposure with opportunity in interbank dealings.
• Strengthen resilience through informed counterparty risk decisions.
• Ensure compliance while optimizing counterparty relationships.

 Duration: 3 days

Skill Level: Advanced

Delivery Mode: In-person

Month: April