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- Publisher
- Oxford University Press
- Copyright
- Journal of Financial Econometrics, Vol. 3, No. 1, © Oxford University Press 2005; all rights reserved.
- ISSN
- 1479-8409
- eISSN
- 1479-8417
- DOI
- 10.1093/jjfinec/nbi007
- Publisher site
- See Article on Publisher Site
Abstract
Following the 1991 recession, financial institutions invested heavily in risk management capabilities. These investments targeted financial (credit, interest rate, and market) risk management. I will show that these investments helped reduce earnings and loss volatility during the 2001 recession, particularly by reducing name and industry-level credit concentrations. I also suggest that the industry now faces major risk challenges (better treatment of operational, strategic, and reputational risks and better integration of risk in planning, human capital management, and external reporting) that are not addressed by recent investments and that will require development of significant new risk disciplines.
Journal
Journal of Financial Econometrics – Oxford University Press
Published: Jan 1, 2005