Managing and Mitigating Liquidity Risks

Book/Article Detail

Chapter 19

Reading Title:	Managing and Mitigating Liquidity Risks
Reading Author(s):	Carrel, Philippe

Book Title:	The Handbook of Risk Management: Implementing a Post Crisis Corporate Culture
Book Author(s):	Carrel, Philippe
Chapter:	19
Page Range:
Total Pages:	24

Publisher:	John Wiley & Sons, Inc. (Visit publisher website)
Publication Year:	2010
Language:	English

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Reading Abstract:	The above analysis leads to the following results. Liquidity risks arise from multiple sources, due to the consequence of multiple operational risks and of their combined effects. Liquidity risks have been identified as the main cause of failure of Tier 1 institutions that were previously thought to be ‘too big to fail’ in 2008 and 2009.

Reading Contents:	1. LAYING DOWN THE FOUNDATIONS OF A CORPORATE STRATEGY a. Chosen risk factors and appetite for risk 2. MONITORING CONCENTRATIONS 3. WORKING WITH RISK CONCENTRATIONS a. Reconciliations or risk concentrations and risk policies b. Managing concentrations 4. ALM ANALYSES AND LIQUIDITY MANAGEMENT a. Margin and business risk analysis b. Sensitivity of duration gaps c. Convexity gaps 5. VALUATION RISKS a. Market depth b. Counterparty-related liquidity risks c. Corporate governance 6. REGULATORY RISK 7. OF LIQUIDITY RISK AND CORRELATION 8. FUNDING STRATEGY IS A RISK PROFILE