News - Risk Systems Implementation

---

ENGAGEMENT OBJECTIVES
A tier 1 UK banking group appointed Essential Consulting after an acquisition. The aim was to deliver strategic credit risk architecture to support the enlarged entity.

Implement new PD, LGD and EAD rating models for both the secured and unsecured portfolio (with combined assets of over £800bn).

Deliver a new grid-based infrastructure and a revised operating model to support enhanced credit risk management processes and reporting across the division.

OUR RESPONSE AND APPROACH
Working directly with the chief risk officer and other members of the risk executive, we first established and defined the management team’s key priorities and objectives.

We completed a full business case and navigated complex internal governance processes to secure required funding and commitment from technology services.

Recognising challenging timelines, inter-programme dependencies and increasing demands on the client’s own SMEs, we mobilised a programme team of 35+ technical experts and change practitioners from our advisory, assurance and programme execution practice areas.

VALUE DELIVERED
Essential Consulting successfully delivered the entire programme, maintaining the complete confidence of the senior stakeholders over the planned two-year implementation.

Achieved regulatory approval of PD PiT and TTT, LGD model in line with the firm’s IRB waiver status.

Reduced overall engine run times from 16 to two hours for the entire portfolio, covering both RWA and impairment actuals and forecasts.

Mitigated all adverse impacts in capital through the implementation of a controlled assurance process ahead of migration activity.

In addition to delivering enhanced credit risk architecture and associated benefits for the firm, Essential Consulting minimised demands on the client’s key SMEs while ensuring effective knowledge transfer at the end of the programme.