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Credit Risk Mitigation – Financial Collateral Comprehensive Method

Collateralising an exposure with financial collateral is one of the credit risk mitigation techniques used by banks to reduce the risk of credit exposures.

PRA publishes Consultation Paper CP14/20

On 30th September, the PRA published Consultation Paper CP14/20, proposing new expectations in relation to Internal Ratings Based (IRB) risk weights for UK mortgages. The main purpose of these proposals is to address the prudential risks stemming from inappropriately low IRB UK mortgage risk weights. The proposed new measures are simple, efficient, and specifically targeted at addressing particular areas of concern that the PRA has observed.