Financial Services Governance & Risk Management

Financial institutions understand that the development of state-of-the-art risk management systems is key to their success. Boards of directors and senior management struggle to determine whether their institutions are taking too much or too little risk. They realize that in today’s financial landscape, they must build and maintain the systems and processes that will optimize the risk/return tradeoff and support integrated risk management at the enterprise level.

LECG risk management services are designed to help our clients identify the risks associated with their operations, products, and services, and develop and implement a process that will effectively control those risks. This process will not only satisfy regulatory expectations, but will position management to make informed business decisions about how to allocate scarce financial and employee resources, maximize profits, and improve the institution's competitive position. In particular, LECG is a recognized leader in the development and assessment of enterprise-wide risk management frameworks. Our framework for the evaluation of risk management (FERM©) is a diagnostic tool that has been used by many institutions to assess the effectiveness of their risk management process.

LECG offers the experience and objectivity needed to evaluate and refine current risk management systems and processes. The firm works with domestic and foreign financial institutions of all sizes to assess risk levels and design comprehensive programs that accurately measure the risk/reward of an institution's operations. LECG consultants with significant hands on experience in the industry and the regulatory agencies deliver an integrated approach to risk management that strengthens an institution's financial performance and ensures regulatory compliance.



LECG risk management and analytics services include:

• Risk Management and Governance
  LECG’s framework for the evaluation of risk management, or FERM:A diagnostic tool used to comprehensively assess the quality of the risk management and governance processes relative to best practices (and regulatory expectations).
  
• Also used as the foundation to develop (or assess) the enterprise-wide risk management (ERM) framework. FERM is based on our review of the seven elements of the risk management process in each risk category.
  
  
• Risk Assessments
  -Detailed assessments of the specific sources of risk and the mitigating controls at the business unit level by our experienced risk professionals.
  -If an institution has already developed its assessments or is in the process of doing so we conduct independent reviews of the existing assessments and of the process used to develop them.
  -Fully compliant with Sarbanes-Oxley, FDICIA, and regulatory expectations.
  
  
• Risk Analytics
  -Development/independent reviews of analytical tools and environments used to measure and manage risks.
  -Basel II economic capital models, interest rate/market risk models, credit risk rating models/tools, operational risk metrics, other.

These services address all major risks faced by a financial institution - credit, interest rate, liquidity, price, transaction, compliance, reputation, operations, and strategic - and can be firm-wide in scope or specific to a business unit, subsidiary, product, geographic region, or risk type.

Representative Engagements

• Acting Director of Credit Risk Management for Small Business Lender
• Advice on Compliance with Regulatory Enforcements for Commercial Bank
• Assessment of Risk Management Processes in Individual Risk Categories for Numerous Financial Institutions

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