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3600 Total Risk Managent Platform
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Credit Origination & Management
We believe that the key to maintaining strong relationships with clients is providing excellent services. Clients are satisfied, when their requirements are met timely, effectively and in a cost efficient manner. Therefore, support and product quality are essential for success of banking business. |
Credit Approval Initiation & Processing
ARX Risk Management solution provides sophisticated Online Credit Approval system which comprises Information Gathering, Data Analysis, Credit Decisions and Pricing, Reporting and Administration.
The whole process can be administered by one or many department depending upon the banks organizational structure. The software can be customized according to the bank’s needs. ARX Risk Management involves Relationship Mangers, his supervisors, Risk Managers and Product Managers (where necessary) as part of the credit approval chain. The system is built on a hierarchical tree with the ability to have different credit approval limits and the rights to edit and archive the approval limits for future reference. |
Credit Monitoring
ARX has designed a platform to monitor and control the risk factors throughout the life of the loan. Loan Monitoring Unit not only monitors the loan repayment by ensuring the adherence to the covenants which were the basis of credit approval. It does this after the credit is approved but before the loan is disbursed and in subsequent periods as may be specified in the approval. |
Collateral Management
The Credit Approval module specifies the necessary covenants and collateral which are required to support the credit. The Collateral Management module has the ability to record, manage and shared collateral related details for various loan profolios.
- Collateral Classification: Module handles all types of collaterals for various loan portfolios, on an “on going” basis.
- Collateral Valuation: The module enables mark-to-market valuation of and wherever necessary mark to market, on an ongoing basis.
- Collateral Sharing: Common Collateral Pledged by more than one borrower so collaterals need to be shared by a number
of facilities or by different subsidiaries. The Module allows Collaterals to be shared on the following conditions:
-By the same company
-By different subsidiary companies.
-Guarantee by the parent company’
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Loan Loss Provisioning
The module offers the flexibility to customize haircut percentages maturity-wise, by debt & other collateral types, by guarantee types and for currency mismatches.
The loan loss allowance amounts and rates across all grades of loan classification, with the flexibility
to customize the weights and provision rates, can be customized as per individual bank’s requirements. |
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Recovery of Problem Loans
It is essential for banks to have an effective and efficient mechanism to deal with problem loans. ARX has developed a framework for monitoring and tracking the recovery of problem loans. It generates automatic alerts for actions required to be taken by the recovery team which ensure effective recovery process.
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Client Management
The ARX Credit Origination & Management module enables the Relationship Manager to manage its relationship with its clients in an effective and efficient manner. With banking relationships becoming increasingly complex, the Relationship Manager needs to ensure that the Client Coverage Teams who interact with clients, share all relevant information regarding the client needs and the product offerings. Further, it is also essential to closely track wins and losses to ensure lessons for the future.. |
| Performance Evaluation
ARX Credit Origination & Management module has the ability to track the performance of the Relationship Manager by generating specialized reports which monitor
- the conversion of leads into clients
- the number of and type of calls made on clients
- number of proposals sent for approval, and tracking proposals which were approved or rejected and reasons for rejection.
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Risk Management
Risk Analytics
In evaluating credits, ARX Financial Analytics has the ability to evaluate the financial performance of a company relative to its peers in the same industry group or others as may be decided by the Risk Manager.
ARX has developed a statistical tool to perform peer group analysis, where wide varieties of meaningful peer groups can be created for comparison purposes. Statistical analysis has been performed to examine the dispersion and concentration of the institutions within the peer group or sector, based on certain selected ratios and comparing them against industry means. The results are presented in graphical formats to enable the Risk Manager to view at a glance if a particular company stands out either positively or negatively against its peer groups.
It enables the Risk Manager to evaluate at a glance a company which is not in line with the industry trends without going through reams of spread sheets to determine the performance of the company being reviewed
Portfolio Analytics
ARX Bank Portfolio management and analysis module enable sophisticated “slice & dice” analysis of the individual borrower as well as the whole industry. It enables the entire bank portfolio to be reviewed by industry, geography, rating, and by product. It also has the ability to do comparative analysis by time periods.
Credit Risk Rating Models
ARX has developed credit rating models using various methodologies, which incorporate both quantitative and qualitative factors, which not only predict borrower’s current financial condition, but also the possible deviation in future financial position in normal and stressed condition.
In recent years, the Basel II Accord in particular has given rise to the need for continuous and costly development and improvement of risk rating models. Therefore, the possibility of applying internal rating models for credit risk assessment is of central importance.
Our analytical services are designed to help clients meet their ongoing risk management functions without building costly internal capabilities. We deliver the institution to “in-house” analysis which it might have considered outsourcing or off shoring, to support the development, testing and validation of risk rating models. |
Model Development
We assist clients to develop models for credit risk. Our team of quantitative analysts has experience in building models with different levels of sophistication based on the availability of data with our clients.
ARX has dedicated team specialized in data mining and use of sophisticated data analysis tools such as Stata 10.0. ARX has developed various statistical models to predicting the default behavior differently. |
Model Validation
Models used for estimation of risks need to be validated on an annual basis as per the BASEL II accord. We use our framework to accommodate variations in the client's estimation methodologies, risk philosophy and differences across regulatory jurisdictions. We validate each assumption used in development of a model, to ensure its applicability in each specific case.
Our models, our methodologies, our benchmarking and validation process are totally transparent and which we share with our clients. We do not believe in a black box approach in dealing with customers.
We encourage viewers to test our international credit rating models at www.arxcreditratings.com |
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