Risk Management for Central Banks - main page
Risk Management - main page
Risk Management for Central Banks agenda
The risk management function and the current challenges it faces
11:00 – 11:15
Course introduction and welcome
Course introduction session led by the chair
- Introductions and welcome from the chairperson
- Overview of the training course programme and speakers
- Discussion of participant expectations and areas of particular interest
Klaus Löber is the Chair of the CCP Supervisory Committee (CCP SC) in ESMA, which was established in 2020. His areas of responsibility encompass the tasks attributed by the European Market Infrastructure Regulation (EMIR) to the CCP SC, in particular the enhanced supervisory convergence towards EU CCPs and ensuring a resilient CCP landscape in the EU as well the monitoring and supervision of CCPs established in third countries in view of the risks that they may pose to the EU financial system. He is also chairing the ESMA CCP Policy Committee contributing to the EU Single Rule Book in the area of CCPs.
Prior to this role, Mr Löber was the Head of the Oversight Division of the European Central Bank in charge of the oversight of financial market infrastructures, payments instruments and schemes. Earlier positions include the Head of the Secretariat of the Committee on Payments and Market Infrastructures, the global standard setting body in the area of payments, clearing and settlement as well as positions in the European Commission, Deutsche Bundesbank and private practice.
Mr Löber regularly publishes on financial markets legal, regulatory and infrastructure issues and lectures at universities.
11:15 – 11:45
What risks and challenges do central banks face?
- Evolution of the risk management function in central banks
- Emerging external risks – the economy, geopolitics and technology
- Evolving risks from the inside – governance, culture and ethics
- Discussion: What are the key risks in the delegates home jurisdiction
Janet Cosier is the former Chief Risk Officer and Adviser on Strategic Planning at the Bank of Canada. She continues in her capacity as the Chair of the Board of Directors of the Canadian Payments Association. She has served in a variety of functions including comptroller and chief accountant, as well as chief internal auditor, before being appointed adviser to the governor. She has provided technical assistance to various central banks in the areas of strategic planning, risk management, governance and financial reporting. Before joining the Bank of Canada, she worked with the Office of the Auditor General of Canada and with the Department of Industry, Trade and Commerce. Mrs Cosier holds degrees from York University and the University of Windsor in mathematics, computer science, accounting and financial management.
11:45 – 12:00
Break
12:00 – 12:45
Internal audit and compliance: efficient operations in three lines of defence set up
- Internal audit – the what and why’s
- Independence and objectivity of Internal Audit functions
- How can internal audit and risk management work together?
- Discussion: Your expectations of internal audit and how can you enhance interactions with internal audit at your organisation?
Mads G. Kristensen is the deputy head of the Internal Audit department at Norges Bank. He is certified as a state authorised public accountant as well as an internal auditor. A substantial part of his work is devoted to the banks operations for managing the Government Pension Fund Global, which is one of the largest sovereign wealth funds in the world. Mr. Kristensen holds an MSc in Accounting and Auditing from BI Norwegian Business School.
12:45 – 13:00
Break
13:00 – 13:45
Cyber risk and the evolving threat landscape
- Overview of the current cyber threat landscape
- Emergence of new risks and the evolution of existing risks
- Examples of strategies and responses to digital disruption and cyber attacks
- Discussion: what does it take to resource a modern cyber resilience function?
Paul Chammas is a Technology Risk & Cybersecurity Consultant and Auditor, with more than 12 years of experience within big consulting firms. He co-founded in 2018 CLARICE, a startup specialized in Innovation & Risk Management, then co-founded in 2021 QuRISK, a startup specialized in Quantum Computing & Risk Management.
Paul holds a Telecommunication Engineering diploma from EFREI Paris and an Advanced Master in Technology Management from HEC Paris. Paul is certified CISA, CRISC and ISO27005.
Business continuity planning in light of Covid-19
11:00 – 11:45
Building resilience through an effective BCP
- Building and managing an effective BCP programme
- Testing and exercising the BC plans to strengthen resilience
- Measures & protocols during Covid-19
11:45 – 12:00
Break
12:00 – 12:45
Responding to disruptive events - invoking BCP during Covid-19
- Challenges faced during invocation of BCP
- What were the communication issues with mobile/networks/power breakdown?
- What was the impact of working from Backup/Alternate working site?
- Discussion: how have BCP/back-up arrangements changed over the past year?
Greg Carpenter is the AVP of Unified Communications for the Federal Reserve. His previous roles span across multiple government organizations including The Federal Reserve Bank of Cleveland, NASA, United States Army Space Command, and United States Air Force Space Command. In these organizations Greg has led risk management, information security, and business continuity functions. The blend of Greg’s background and a focus on customer experience provides a unique perspective to risk management and technology survivability approaches.
12:45 – 13:00
Break
13:00 – 13:45
Reputation risk and building trust with employees, clients, shareholders, regulators and the public
- Key factors and dynamics affecting a central banks reputation
- Examples of how to avoid reputational damage through revisionary frameworks and reforms
- Methods and tools of how board members can view operational, financial and reputational risks
- Discussion: establishing the tools that will be used to identify and monitor reputational risks
Jill Vardy was appointed Advisor (Communications) and Chief of Staff, effective 3 January 2017. In this role, she provides strategic communications advice on major corporate and policy-related issues and works closely with Executive Council and department chiefs to maximize the Governor’s schedule and work priorities. She also plays a key role in strategic thinking and engagement with the Bank’s partners and stakeholders.
Ms. Vardy spent 14 years covering economics, finance, government policy and the technology sector for The Financial Post (later incorporated into the National Post). After covering economics in Toronto, she spent six years as a Parliament Hill reporter in Ottawa and six years as the National Post’s senior technology writer and columnist. In addition to writing, she also appeared frequently as a business panelist on CBC radio and television and taught economics and business journalism at Carleton University.
Ms. Vardy joined the Bank of Canada’s Communications Department in 2002 as a speechwriter for the Governor and other members of Governing Council. She became Director, Planning and Public Affairs, in 2006. In 2008, she served as the department’s Acting Chief and was then named Deputy Chief. She became Chief of Communications in December 2010, a position she held until her current appointment.
Born in Corner Brook, Newfoundland, Ms. Vardy attended Mount Allison University and earned an honours degree in journalism from Carleton University.
Risk management: conduct and culture
11:00 – 11:45
How central counterparties dealt with Covid-19
- 2020 saw unprecedented market moves due to COVID-19 and financial market infrastructures including central counterparties needed to respond.
- Total margins were raised by CCPs worldwide due to the high volatility but needed to be balanced to mitigate procyclical effects.
- Pandemic and cyber crisis management exercises (conducted some years ago) revealed substantial operational risk issues but the experience so far has been positive
Professor Ron Berndsen is an independent director of LCH and chairs the LCH Risk Committees. He is also attached to the Tilburg School of Economics and Management at Tilburg University as full professor of Financial Market Infrastructures and Systemic Risk.
Ron is editor-in-chief of the Journal of Financial Market Infrastructures and a member of the Advisory Council of the SWIFT Institute.
The author has been active in the field of payments and market infrastructures for over 15 years. He was Head of the Oversight Department and Head of the Market Infrastructures Policy Department at De Nederlandsche Bank. Ron also served as a member on the Market Infrastructure Board at the European Central Bank and as member of the Committee on Payments and Market Infrastructures at the Bank of International Settlements. He also co-chaired the FSB Group on Cross-Border Crisis Management for Financial Market Infrastructures and was a member of the oversight committees of CLS, EuroCCP, Euroclear, LCH, SWIFT and TARGET2.
He was awarded a doctorate of Tilburg University in 1992 for his PhD thesis in Economics and Artificial Intelligence.
11:45 – 12:00
Break
12:00 – 12:45
Enabling the risk function: moving towards an integrated corporate management function
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Overview of new roles, functions and responsibilities of risk management departments
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Impacts of organisational developments on central bank risk management
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Key components of a robust and responsive risk management framework
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Discussion: where and how are risks managed in participants’ central banks?
Janet Cosier is the former Chief Risk Officer and Adviser on Strategic Planning at the Bank of Canada. She continues in her capacity as the Chair of the Board of Directors of the Canadian Payments Association. She has served in a variety of functions including comptroller and chief accountant, as well as chief internal auditor, before being appointed adviser to the governor. She has provided technical assistance to various central banks in the areas of strategic planning, risk management, governance and financial reporting. Before joining the Bank of Canada, she worked with the Office of the Auditor General of Canada and with the Department of Industry, Trade and Commerce. Mrs Cosier holds degrees from York University and the University of Windsor in mathematics, computer science, accounting and financial management.
12:45 – 13:00
Break
13:00 – 13:45
Enhancing the culture of risk management: effective steps for successful implementation
- Key building blocks of the risk awareness culture
- Examples of strategies to strengthen the risk awareness culture in central banks
- The role of risk awareness in organisational resilience
- Discussion: how to build a risk culture for 2021 and beyond
Janet Cosier is the former Chief Risk Officer and Adviser on Strategic Planning at the Bank of Canada. She continues in her capacity as the Chair of the Board of Directors of the Canadian Payments Association. She has served in a variety of functions including comptroller and chief accountant, as well as chief internal auditor, before being appointed adviser to the governor. She has provided technical assistance to various central banks in the areas of strategic planning, risk management, governance and financial reporting. Before joining the Bank of Canada, she worked with the Office of the Auditor General of Canada and with the Department of Industry, Trade and Commerce. Mrs Cosier holds degrees from York University and the University of Windsor in mathematics, computer science, accounting and financial management.
Risk management tools and methodologies
11:00 – 11:30
Closing remarks and delegate action plans
Concluding session led by the chair
- Summary of the course
- Discussion of the observed trends and case studies
- Application of learning points in the delegates’ home organisations
- Preparation of action points
11:30 – 11:45
Break
11:45 – 12:30
Modernizing KRIs and risk appetite for central banks
- A risk appetite statement: use of this framework in a central bank
- How this framework can be a means to improve risk culture and awareness
- Achieving sufficient granularity to cover all the main risks of the institution
- Case study: how a central bank covers this issue; the pros and cons: an example from the Bank of Portugal
Gabriel Andrade is the head of the Risk Management Department at Banco de Portugal, which he has been responsible for since October 2014. He is currently the Chair of the Eurosystem Resilience Task Force He is also a member of the International Operational Risk Working Group (IORWG) and works regularly in technical assistance missions of the International Monetary Fund (IMF) to Central Banks. From 1987 to 2013, Mr. Andrade worked in the private banking sector, including 20 years with Barclays Bank. He holds an Economics degree from the Lisbon School of Economics (ISE), as well as numerous post-graduate degrees elsewhere, including Universidade Católica Portuguesa (UCP), AESE Business school (AESE / IESE) and Universidade Nova de Lisboa (UNL).
12:30 – 12:45
Break
12:45 – 13:30
The risk management function: resourcing and institutional organisation
- Overview of institutional arrangements for the risk management function
- A framework for re-evaluating and strengthen risk governance
- Resourcing: changing requirements for skillsets and systems
Evangelos Tabakis is the head of Risk Management and Compliance in the Central Bank of the United Arab Emirates, responsible for financial and operational risk, business continuity, information security and compliance across the activities of the central bank. Previously he had been at the European Central Bank (ECB) in Frankfurt for fourteen years, holding positions in Market Operations and Risk Management. Most of his work at the ECB was related to the operational, risk management and financial stability issues posed by large scale collateralized lending to banks. Prior to his central banking career, Mr. Tabakis held academic positions at Yale University, the University of Bayreuth in Germany and the Athens University of Economics and Business in Greece. He holds a first degree in Mathematics from the University of Athens and a Ph.D. in Applied Mathematics (Mathematical Statistics) from the Massachusetts Institute of Technology.
Central Banking’s Post Training is a chair-led forum where participants can bring further questions or discussion points to group, after the live content and self-paced learning elements. What has worked, and what has not? Post Training focuses on questions that may have arisen since returning, the challenges of implementation and the setting of medium-term goals. Participants are encouraged to bring a short presentation, or questions on a particular topic, to gain the most from the discussions with peers.
14:00 – 15:00
Implementation Workshop
Benefits of attending the Implementation Workshop:
- Developments in the area since the live content sessions, including new resource material
- Questions arising since returning to the central bank
- Challenges of implementation: where are the roadblocks?
- Medium-term goals: what is realistic?
- Establishment of group network to keep in touch with peers and share best practices
Chair
Chair: Janet Cosier
Former advisor on strategic planning and risk management
Former Bank of Canada
Janet Cosier is the former Chief Risk Officer and Adviser on Strategic Planning at the Bank of Canada. She continues in her capacity as the Chair of the Board of Directors of the Canadian Payments Association. She has served in a variety of functions including comptroller and chief accountant, as well as chief internal auditor, before being appointed adviser to the governor. She has provided technical assistance to various central banks in the areas of strategic planning, risk management, governance and financial reporting. Before joining the Bank of Canada, she worked with the Office of the Auditor General of Canada and with the Department of Industry, Trade and Commerce. Mrs Cosier holds degrees from York University and the University of Windsor in mathematics, computer science, accounting and financial management.