Risk Management

The bank’s risk management goal is to ensure stability and soundness, to protect the interests of its shareholders’ customers in carrying out its core activity, and to achieve the results envisaged by the bank’s strategy.

Risk Management Development Principles

The bank’s risk management system adheres and conforms to the following principles:

  • The principle of compliance with the bank’s overall strategy as regards doing banking in the most effective way (i.e. with maximum profitability and minimum risks);
  • The principle of risk management independence. Risk management subdivisions cannot form part of, or report to a senior manager who has oversight of, any subdivisions taking risks and fulfilling the bank’s business plan;
  • The principle of risk managers’ responsibility for the methodological, analytical, controlling and coordinating role in the bank’s overall risk management system;
  • The principal of engaging the bank’s collective bodies and management in its risk management control procedures;
  • The principle of taking action to minimise the probability of risks and/or mitigate the impact of assumed risks;
  • The principle of risk managers’ membership in all of the bank’s collective bodies (committees, commissions, panels, etc.) who have authority to assume any kind of risk;
  • The principle of standardisation of products, services and processes for the bank as a whole; provision of services at its places of presence in line with unified standards and technologies which provide the most efficient way to achieve targets and to prevent any human-caused unforeseeable losses resulting from any individual’s adverse interference with the bank’s operations;
  • The principle of three-level risk management:
    • strategic: risk management at the level of the bank as a whole;
    • tactical: risk management at the level of specific business areas;
    • operative: risk management at the level of individual counterparties (borrowers, issuers), exposures, instruments and processes;
  • The principle of full integration of the risk management function into the corporate governance procedure: all processes in the bank should be built subject to compliance with the risk management policies and standards. The risk management function must be involved in making decisions to develop or implement new, or upgrade existing, objectives, plans or products of the bank, and in setting priorities in its activities;
  • The principle of building the risk management function as a centralised structure responsible for management of the bank’s critical risk types;
  • The principle of arranging risk management functions by the following areas: risk determination, identification, assessment, monitoring, reporting and control;
  • The principle of awareness and involvement of all concerned subdivisions in the bank’s risk management approaches and methods;
  • The principle of risk analysis: no risks may be taken until analysed by the risk management function. The bank shall not take any non-quantified or non-qualitatively assessed risk. The Bank may not assume any risk without cover or security, until its magnitude and likelihood is assessed;
  • The principle of linking the risk management system organisation quality and the level of risk taken to remunerations, compensations and incentives of the bank’s executives and risk takers.