Financial Risk Manager Part 1
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The risk management committee at a US-based bank has appointed a risk consultant to help the committee implement an ERM program. The consultant provides advice on how to set up an ERM framework that is consistent with industry best practices. Which of the following recommendations should the consultant make?
A
The bank should separate the decision-making processes of managing credit risk from those of managing market risk to ensure the proper management of its exposures to each risk.
B
The bank should develop strategies used to manage enterprise-scale risks at the firm-wide level and implement them across the business lines.
C
The bank should build a robust enterprise risk culture that is independent of the views of the board of directors on the value of the bank's business activities in order to avoid any conflict of interest.
D
The bank should discourage the integration of the risk management process with the balance sheet management process.