Sr Consultant/Manager - Risk Based Supervision - Big4

Sr Consultant / Manager in Risk Based Supervision for a Leading Big4

Mumbai

Jd:

Risk Based Supervision

Stability of the financial system has become the central challenge to bank regulators and supervisors throughout the world in the recent years including in India. The adoption of the CAMELS approach to supervisory risk assessments and rating and the tightening of exposure and prudential norms and enhancement in disclosure standards in phases, has more closely aligned the Indian banking system to international best practices. The RBS process involves continuous monitoring and evaluation of the risk profiles of the supervised institutions (i.e. banks and FIs) in relation to their business strategy and exposures based on a risk matrix for each institution.

The objective of RBS is to :

- to optimize utilisation of supervisory resources and

- minimize the impact of crisis situation in the financial system.

Elements of Risk Based Supervision process:

- Risk profiling of banks.

- Supervisory cycle and supervisory program.

- Inspection process.

- Review, evaluation and follow-up.

- Monitorable action plan (MAP)

- Supervisory organization

- Enforcement process and incentive framework

Risk profiling of banks : Risk profiling is designed for assessing business risks and control risks. Business risks have been classified into 8 categories (capital, credit, market, earnings, liquidity, business strategy and environment, operational and group risks). Control risks have been classified into 4 categories (internal control, organization, management and compliance risk). Overall risk of banks is to be assessed as low, moderate, fair or high. The banks with low risks will have longer supervisory cycle and lesser supervisory intervention.

Supervisory cycle: The supervisory process would commence with the preparation of the bank risk profile and will vary according to risk profile of each bank, the principle being the higher the risk the shorter will be the cycle. The supervisory program is to be planned for individual banks that would focus on the highest risk areas. It would identify various supervisory such as greater off-site surveillance, targeted on-site inspection etc.

Inspection process : The inspection would target identified high-risk areas from the supervisory perspective and would focus on the effectiveness of mechanism in capturing, measuring, monitoring and controlling various risks.

Review, evaluation and follow-up : The evaluation will be undertaken to ensure that the supervisory program has been effective in improving the risk profile of the bank concerned. The risk profile document of the bank will be accordingly updated in the light of new information.

Monitorable action plans (MAP) : For ensuring that corrective action is taken by banks in time to remedy/mitigate any significant risks, identified during the supervisory process, MAPS are used by RBI to set out the improvements required in the areas identified during the current on-site and off-site supervisory process. If actions and timetable set out in the MAP are not met, RBI would consider issuing further directions to the defaulting banks and even impose sanctions and penalties. The mandatory and discretionary actions in the Prompt Corrective Action framework are a part of the supervisory enforcement action.

Preparation at the level of banks : Individual banks required to initiate the steps such as setting up of risk management architecture, adoption of risk focused internal audit, strengthening of management information system, reorientation of the staff and setting up of compliance unit.

Risk focused internal audit : The internal audit function is a part of the ongoing monitoring of the system of internal control and assists the staff in effective discharge of their responsibilities.

Interested Candidate please Forward Your CV at the Earliest with Current and Expected with Notice Period

Shraddha Mehta
Mindshare Recruitment Consultants Pvt Ltd
Tel : 022-67615017
URL : www.mindshareconsultants.com