Review of the Risk Management Framework Following Losses Incurred by U.S. Prime Brokerage Clients
First written in FY2022-Q1. 1 of 3 entries say "Achieved", first in FY2022-Q2. Latest entry: FY2022-Q3.
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- FY2022-Q3RestatedAnnual report
「We are strengthening the functions of various risk management committees, including expanding the scope of portfolio reviews to cover all wholesale businesses other than the financing business. In addition, on 29 October 2021, we established a Risk Committee chaired by an outside director and composed of non-executive directors to discuss significant risk matters independently of management execution.」
In response to losses incurred by U.S. customers, the company has continued to disclose the completion of each phase, the expansion of the scope of portfolio reviews, the establishment of the Risk Committee and the restructuring of executive bodies. - FY2022-Q2AchievedAnnual report
「• Phase 1: Initial response <Completed> • Phase 2: Review of the prime brokerage risk management framework <Completed> • Phase 3: Review of the wholesale division risk management framework <Completed> • Phase 4: Strengthening global risk governance <Completed>」
It was disclosed that the phases covering the initial response, prime brokerage, the wholesale division and global risk governance in response to losses incurred by U.S. prime brokerage customers had been completed. A structure including the Risk Management Enhancement Steering Committee and the CTO has also been established. - FY2022-Q1First statedAnnual report
「・ Phase 1: Initial response <completed> ・ Phase 2: Review of the prime brokerage risk management framework <in progress> As part of this phase, we are working to strengthen monitoring of concentrated positions, review the margin ratios applied to counterparties, and strengthen the management of margin ratios for individual transactions, including internal approval processes. ・ Phase 3: Review of the wholesale division's risk management framework <in progress> We are considering additional measures based on the results of the review by external experts. We are also working to strengthen the organizational structure for risk management, including IT infrastructure and staffing. ・ Phase 4: Strengthening global risk governance <in progress> We are considering strengthening the functions of various risk management committees, including expanding the scope of portfolio reviews to cover all wholesale businesses other than the financing business.」
In response to losses incurred by U.S. customers, the initial response has been completed, while reviews covering prime brokerage, the wholesale division and global risk governance are in progress.