As part of our solution for risk quantification of retail exposures we have built a three-tier framework (segmentation for “homogeneous” pooling, risk component modelling and risk-weighted assets estimation). The advanced segmentation and modelling techniques of our framework allow a bank to satisfy the requirements set by the Accord as well as incur substantial savings in capital.

For the estimation of the risk components for corporate lending we apply the techniques and models that we have developed for Financial Risk Rating for Small Business and Commercial Lending.

For validation of the models involved in the IRB approach we use the diagnostic system we have developed for Model Validation.

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