Aggregate OTC exposures dynamically and in real time

The credit crisis taught financial institutions many painful lessons about counterparty risk management. Consequently it has become a major concern given the high profile collapses of some centuries-old financial institutions like Lehman Brothers and Bear Stearns.

Counterparty risk is also at the core of initiatives by regulators to mitigate systemic risk in the aftermath of last year’s events. As reported by the Counterparty Risk Management Policy Group, stringent requirements on market, credit and counterparty risk will be imposed on financial institutions including constraints to aggregate counterparty exposures on an enterprise basis in a matter of hours.

Few firms question the heightened importance of measuring and tracking counterparty risk exposures or the necessity to take a holistic view of exposures across business silos within firms and also across market, credit and counterparty risk. Getting an accurate view of the risk across books and portfolios has become critical.

Hyper Rig can aggregate OTC exposures across systems and business lines and to perform the most complex full Monte Carlo risk simulations for very large vanilla and exotics trading books in a matter of seconds and not hours enabling institutions to compute and monitor risk limits on a pre-trade basis.