A proposal for an open-source financial risk model

Jong Ho Hwang

Journal of Financial Regulation and Compliance, 2014, vol. 22, issue 3, 219-234

Abstract: Purpose - – The purpose of this paper is to present a policy proposal for building a new framework for gathering, measuring and disclosing financial risk information in the global economy. Design/methodology/approach - – The paper examines the current state of the financial risk framework, notes its advantages and disadvantages and proposes a new construct that aims to address some of the shortcomings that are currently in place. The goals of a robust financial risk model are examined to determine the design of the proposed risk framework. Findings - – The proposed open-source financial risk model separates the dual function that internal risk models perform within financial institutions, first to attempt to optimize the risk–return profile of mostly private economic rent-seeking entities, and second to maximize safety and soundness considerations for the public which is at risk of bearing the consequences of financial actors. Practical implications - – The model allows widespread use of robust financial risk models. Social implications - – The model enables a more transparent and democratic process for risk management. Originality/value - – The study proposes a new global supervisory framework. Practical implications - – The model allows widespread use of robust financial risk models. Social implications - – The model enables a more transparent and democratic process for risk management. Originality/value - – The study proposes a new global supervisory framework.

Keywords: Supervision; Financial institutions; Basel; Open-source models; Risk management framework; Solvency II (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:jfrcpp:v:22:y:2014:i:3:p:219-234

DOI: 10.1108/JFRC-08-2013-0027

Access Statistics for this article

Journal of Financial Regulation and Compliance is currently edited by Prof John Ashton

More articles in Journal of Financial Regulation and Compliance from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().