Risks and principles

General

  • Risks are only taken within risk tolerance limits following careful consideration.
  • Risks are managed systematically.
  • Risks are only taken if they can be borne, offset by reasonable returns, and the capabilities for managing the risks have been confirmed.
  • Risks are effectively contained, controlled and independently managed at all levels.

Credit risk

  • Loans are only extended to clients who meet minimum creditworthiness and solvency criteria.
  • Concentration risks are avoided relating to clients, industries or geographic regions.
  • The credit policy is prudent.
  • The focus is on financing owner-occupied residential property.
  • Corporate clients are evaluated based on the following aspects: Regional ties, sufficient diversification, risk/return ratio and minimal exposure to high-risk industries.

Market risk

  • Risks in the trading and banking books are managed based on clearly defined guidelines.
  • Clear strategic lines are drawn using limits and proven tools.
  • Raiffeisen Switzerland trains and advises the Raiffeisen banks regarding their market risk in the banking book.
  • Foreign currency assets are generally refinanced in the same currency (matched book approach).

Liquidity risk

  • Refinancing sources are reasonably diversified.
  • Liquidity in the Raiffeisen Group is managed at operational/tactical and strategic levels.
  • The Raiffeisen banks manage liquidity risks at their own discretion based on instructions provided by Raiffeisen Switzerland.
  • Access to money and capital markets is provided centrally through Raiffeisen Switzerland.

Operational risk

  • Risks are evaluated through regular top-down and bottom-up risk assessments.
  • Risks are monitored using risk indicators and an early warning system.
  • The appropriateness and effectiveness of key controls in all risk-related processes is periodically reviewed and confirmed.
  • Internal and external events are analysed on an ongoing basis; the findings from these analyses are implemented in the operational business processes.

Legal and compliance risk

  • Internal policies and processes are promptly adapted to reflect changes in laws, regulations and professional rules and then implemented.
  • Contracts are followed and enforced.