Case Study |

Single Counterparty Credit Limits

Context

The objective of the proposed rule is to reduce systematic risk by limiting large banking organizations credit exposure to a single counterparty as a percentage of the bank’s capital.

The Project

To build the SCCL capability, Arrayo’s team has:

– Led the study period which covers assessing the requirements

– Operationalized the program to the extent of having fully functional workstreams (Client Hierarchy, Securities and Exposure, Aggregation and Reporting, Policy, Regulatory Reporting and Model Valuation)

– Led the Client Hierarchy and Securities/Exposure workstreams and developed requirements and operational processes for the Credit Risk & LOB stakeholders.

– Managed 2 project workstreams during requirements development phase:

(a) Hierarchy – determined requirements for the client counterparty roll-up hierarchy, including business rules & end user interface

(b) Securities and Exposures – determined data gap requirements for all work streams, worked out remediation plans, monitored implementation of fixes

– Created test plan & test cases for the Hierarchy workstream, executed test cases using SQL queries, analyzed results using Excel & Access, worked with stakeholders & system team to remediate case exceptions

– Responsible for project planning and execution via Microsoft Project, Steering Committee reporting via PowerPoint

– Worked extensively with key stakeholders, Credit Risk, Wealth Management, Technology Implementations teams to work out requirements, test results, and remediate exceptions

Outcome

Arrayo has been successful at operationalizing the above-mentioned workstreams.  Several project workstreams have been successfully executed by Arrayo’s team: requirements definition, business rules, end user interface, data gap requirements, tests planning and execution.

The team has also been involved in stakeholders’ management and program management activities throughout the program.