Model Risk Management

Boards and management rely heavily on model output to make strategic and/or operational decisions and it is important to have a proper program in place to ensure accuracy and reliability. Designing and implementing a well-developed Model Risk Management program will enable your institution to organize and capture the risks associated with running models throughout the model lifecycle while also providing an “effective challenge” environment as prescribed by the regulators.

MRM & Governance Development

  • Development of fully-integrated model risk management and governance framework
  • Establishment of a comprehensive risk management function to oversee all models throughout the lifecycle essential to the management and mitigation of model risk.
  • Effective deployment of model risk governance, policies and controls to ensure a regulatory compliant model risk management function.

Model Inventory & Risk Grading

  • Deployment of a comprehensive model risk inventory along with associated risk ratings.
  • End-to-end process for the identification and proper classification of all models through the lifecycle, including both models in development and models in production.
  • Design and deployment of verifiable model risk rating systems to ensure the proper identification, management, and mitigation of model risk.

Risk Assessment Process & Utilization

  • Full development of the requisite model risk assessment process to facilitate full capture of attendant model risks across the model lifecycle.
  • Full integration of model risk assessments into periodic risk rating reviews and model validation deliverables.

Resource Requirements & Deployment

  • Independent assessment of model risk management resource capabilities, resource deployments, and resource utilization.
  • SME expertise for co-sourced and outsourced model risk management services and support.
  • Staff augmentation for any stage of the risk model lifecycle and MRM function, for models in development, in production, or subject to current calibration.

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