Risk Management In Banking And Insurance (RMBI) (Paper-20B) CMA Final Electives

SECTION A: RISK MANAGEMENT IN BANKING [60%]

• Concept of Risk
• Risk vs. Uncertainty
• Types of Risk
• Risk Management – Concept and Approaches
• Risk Management Strategies

• Interest Rate Risk Management
  • Concept
  • Source
  • Term Structure of Interest Rates and Yield Curve
  • Interest Rate Risk and Credit Risk
  • Measuring Interest Rate Risk
  • Interest Rate Risk Measurement and Basel Norms
  • Managing Interest Rate Risk
• Market Risk Management
  • Market Risk and its Types
  • Calculating Market Risk Exposures
  • Market Risk and Basel Norms, Value-at-Risk (VaR)
  • Sources of Foreign Exchange Risk Exposure
  • Foreign Asset and Liability Positions
  • Interaction of Interest Rate
  • Inflation and Exchange Rates
  • Hedging Market Risk
  • Dynamic Hedging Strategies

• Credit Risk Management
  • Credit Risk Exposures, Types
  • Credit Risk Measurement Models – Merton’s Model
  • Credit Risk Measurement and Basel Norms
  • Managing Credit Risk
• Management of Non-Performing Assets (NPAs)
  • Definition, Concept and Categorisation of NPAs
  • Choices available to Banks for Management of NPAs
  • Trading of NPAs
  • Status of NPAs in Banks in India
• Liquidity Risk Management
  • Liability-side and Asset-side Liquidity Risk
  • Types of Liquidity Risk Events
  • Liquidity Risk vs. Credit Risk
  • Liquidity Risk in Insurance Services
  • Measuring Liquidity Risk
  • Managing Liquidity Risk
  • Asset Liability Management – Concept
  • Role of ALM in managing Interest Rate Risk and Liquidity Risk
  • RBI Guidelines

• Sovereign Risk Events
• Debt Repudiation versus Debt Rescheduling
• Evaluation of Sovereign Risk
• Mechanisms for dealing with Sovereign Risk Exposures
• Insolvency Risk Analysis through Capital Adequacy Ratios

• Operational Risk – Identification and Assessment, Basel Norms
• Monitoring and Mitigating Operational Risk
• Off-Balance Sheet Risk Exposures
• Loan Commitments
• Commercial Letters of Credit, Letters of Undertaking and Bank Guarantee
• Derivatives
• Deposit Insurance
• Nature of Off-Balance Sheet Risks

SECTION B: RISK MANAGEMENT IN INSURANCE [40%]

• Definition, Concept and Features of Insurance
• Principles of Insurance
• Role of Insurance towards Economic Growth
• Difference between Insurance Companies and other Financial Institutions
• Insurance Regulatory and Development Authority (IRDA) – Objectives, Statutory Powers and Functions of IRDA

• Insurance Intermediaries
  • Insurance Agents
  • Surveyors and Loss Assessors
  • Insurance Brokers
  • Third Party Administrators (TPAs)
  • Bancassurance
  • Other Channels
• General Insurance
  • Principles
  • General Insurance Products
  • Tariff Advisory Committee (TAC)
  • General Insurance Council
  • De-tariffing in General Insurance
  • IRDA’s Exposure/Prudential Norms
  • Solvency Margins of Non-life Insurers
• Concept and Types of Health Insurance Policies
• Structure and Type of Re-insurance
• Life Insurance
  • Principles and Characteristics
  • Types of Life Insurance Products
  • Solvency Margins of Life Insurers
  • Various players in Life Insurance Business
  • LIC of India
  • Post Office Life Insurance
  • Other Players

• Concept of Risk in Insurance Business
• Factors affecting Risk Profile of Insurers
• Kinds of Risks in Insurance – Portfolio Risk, Solvency Risk, Marketing Risk, Market Risk, Operational Risk and Other Risks
• Risk-based Capital, Types of Risk-based Capital – Current Risks, Special Risks, Non-technical Risks
• Risk Management Process in Insurance
  • Risk Identification
  • Risk Assessment
  • Risk Treatment
  • Risk Reduction
  • Risk Review and Monitoring
• Role of an Actuary in Insurance Business