New Enterprise-Wide Risk Management Solution from Reuters - Helping Customers Manage Credit Risk for Complex Products and Meet Requirements for Basel II.
Reuters Kondor Global Risk is a module within the Reuters suite of Kondor trade and risk management solutions which are already used by 14,000 users across 60 countries worldwide. This is an important product launch for Reuters as it demonstrates commitment to the risk industry and complements the well established Reuters Kondor+ and Trade Processing systems.
The new Reuters Kondor Global Risk module is an enterprise-wide credit risk and limit control application which consolidates information across all subsidiaries and distributes risk figures in real time onto every desk.
It has two important areas of functionality:
--A complete firm-wide limit management framework covering trading and banking book instruments, including credit risk mitigation techniques (netting agreements, collateral management, guarantees and credit derivatives) and leveraging workflow capabilities for excess management and double validation of static data - providing improved flexibility in limit management.
--A Basel II regulatory capital module - to improve compliance in the credit risk area, for both the trading book and the banking book. Enabling customers to calculate risk parameters (exposure at default, probability of default, loss given default, risk weights) and capital requirements against the three proposed methodologies (standardized method and foundation and advanced internal rating-based approaches). This is achieved through the application of a common framework to measure, value, monitor and report trading and banking book exposures.
Reuters Kondor Global Risk includes a risk engine for Monte-Carlo simulation based Potential Futures Exposures for better credit exposure analysis - to assess credit risk for instruments sensitive to market moves, such as complex derivatives and structured products - where traditional add-ons are too static. This sophisticated computational functionality has been designed to make use of Grid technologies to ensure delivery of today's most demanding requirements for increased power and lower cost of ownership.
To ensure the effective enablement of Grid technology, Reuters is collaborating with IBM, Intel and DataSynapse. IBM is currently undertaking performance benchmarking on Kondor Global Risk on IBM's Blade Center technology, equipped with Intel's advanced processor technology and a Red Hat Linux operating environment. Early results of the benchmarking indicate that the application can complete a full PFE analysis for an average bank in less than 5 minutes - bringing this type of advanced complex analysis into the reach of most banks through superior price performance.
Tom Swett, IBM General Manager, Global Financial Markets, said, "We are proud to collaborate with Reuters in such an exciting domain as computational finance. IBM is committed to delivering industry leading infrastructure solutions and Grid enablement is a key example of this. We look forward to continuing to work closely with Reuters in taking this to other areas of the Kondor product suite."
Thibault Le Masson, Head of Enterprise-Wide Risk Management at Reuters, said, "The launch of Kondor Global Risk is Reuters response to banks needing greater sophistication in limits management, coupled with the requirement to comply with Basel II. The power of Kondor Global Risk, including the complex simulation functionality can be fully realised through the use of Grid technology - allowing us to deliver a superior solution with impressive price performance."
Building on more than 20 years experience in the risk industry, the Kondor suite is a highly sophisticated, modular solution designed to provide a best fit with your business requirements. More than 50% of the world's top 25 banks rely on Reuters Kondor trade and risk management solutions at every step of the trade.
About Reuters Kondor+
Reuters Kondor+ is a real-time pricing, capture and position keeping system offering a sophisticated and flexible means of managing deals and positions across all instruments. Together, Reuters Kondor+ and Kondor Trade Processing offer a seamless, two way, interactive front-to back-office solution. Kondor Global Risk and Kondor Value at Risk deliver tools for the management of complex global market and credit risk.
Reuters (www.reuters.com), the global information company, provides indispensable information tailored for professionals in the financial services, media and corporate markets. Its trusted information drives decision making across the globe based on a reputation for speed, accuracy and independence. Reuters has 14,500 staff in 91 countries. This includes 2,300 editorial staff in 196 bureaux serving 129 countries, making Reuters the world's largest international multimedia news agency. In 2004, Reuters Group revenues were GBP 2.9 billion.
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