Liquidity risk is hard to understand. It needs to be broken down into its components and drivers in order to manage and model it successfully. The market turmoil that began in mid-2007 re-emphasised the importance of liquidity to the functioning of financial markets and the banking sector. In...

With the need to expel huge amounts of non‐performing loans from their balance sheets, their share prices sinking and their credit ratings lowered, Japan’s banks are struggling to raise new capital and may face collapse. But the current crisis could have been avoided. If they had implemented...

Advanced software and hardware solutions are enabling institutions to progress from traditional asset liability management to earnings sensitivity and future market valuation across dynamically modelled balance sheets. By implementing pre‐defined management trading strategies across scenarios...

"The standardization of Islamic financial products is currently evolving, both for Islamic derivatives & hedging methods and for Islamic bonds (Sukuk) and the process of standardization is expected to start soon also for other Islamic instruments. Islamic capital markets, and Islamic finance in...

Significant research has been done in recent years to develop sophisticated models that capture liquidity risk in the risk management framework. But even the best models have to be complemented by a comprehensive validation framework that adapts quickly to fast changing market...