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Expert opinion: Peter Roosenboom Erasmus University

Good risk management also essential in private equity sector

There has been a lack of transparency in the private equity sector and weaker market players have failed in the past two years.

Could better risk management in the private equity sector mean a safer ride for everyone in turbulent financial markets?

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Don’t hide behind IAS39

Achieving hedge accounting for foreign exchange risk management

Throughout 2009, volatility in the foreign exchange markets was a key theme. Although the financial markets calmed a little, corporate treasurers still face an environment in which their risk management policies are tested. For the multinational company, FX risk management is one of the main activities to protect profitability.

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How solid is your credit ratings framework?

Credit rating philosophy and framework

Financial institutions must pull out all the stops to meet the more stringent requirements for risk management.

Having a solid credit ratings and portfolio management framework is crucially important. But how consciously are they tackling the task? Do they really know how appropriate and consistent the rating models are on which they base and control risks?

And do financial institutions know what is going on behind the figures on their dashboards?

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The advantages of hedge accounting

An interest swap is a practical way of covering interest rate risks. Provided that a number of rules are observed, it is permissible to use hedge accounting in such cases.

In this article, senior consultant Mark van den Berg explains the advantages of hedge accounting with the help of an example from the business community.

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The Art of Alternative Risk Transfer

Renewable energy sector

The renewable energy sector depends on natural resources such as the sun and the wind.

Due to the unpredictable nature of these resources, it is often difficult for the renewable energy sector to insure against the risk of not reaching the minimum production levels.

Applying Alternative Risk Transfer (ART) by means of Insurance-linked Securities (ILS) is a way to bring this risk to the capital markets.

By the end of 2007, the ILS market in the US reached a peak of US$15bn. In Europe, the ILS market is still in its infancy and offers abundant opportunities for innovative corporate finance boutiques and insurance companies.

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