Major Roles in Banking


Risk Management

Risk management is about identifying, analysing and responding to risk factors that affect the bank. Major risks faced by banks include credit, market, operational and liquidity risks. The risk management function is independent of the front office and has a direct reporting line to senior management and board-level committees.

Major job responsibilities

Policy setting/formulation
  • Develop a risk management framework.
  • Develop a control framework to reduce the possibility and potential impacts of adverse risk events.
  • Set and assign risk limits to teams, desks and individuals where applicable.
  • Put in place an internal audit function to review the controls.
  • For risks that cannot be controlled, set risk acceptance policies.
Risk analysis
  • Identify inherent risks.
  • Assess the risks in terms of likelihood and severity.
  • Develop an appropriate response or action plan.
  • Calculate exposure to each risk.
  • Communicate risk policies and processes.
  • Provide training and certification to bank staff.
Reporting and review
  • Report on risk exposures vs risk limits.
  • Use visual means to report on risks to senior management (charts, graphs, diagrams).
  • Prepare a report on qualitative factors.
  • Stress-test the system.

Important skills and knowledge

Banking business and financial market knowledge
  • Thorough understanding of business goals
  • Knowledge of external markets
  • Understanding of the impact of climate issues
  • Product knowledge
  • Accounting policy knowledge
Data analysis skills
  • Financial modelling
  • Mathematical ability
  • Logical thinking and associative skills
  • Computer, data entry and MS Office skills
  • Strong attention to detail and organisation
Legal and regulatory knowledge
  • Solid, up-to-date knowledge of legal and regulatory requirements
  • Cross-border tax knowledge
Communication with staff and senior management
  • Excellent communication skills, written and spoken
  • Presentation skills
  • Negotiation and persuasion skills

A day in the life of a
Risk Management Specialist

Catch up with financial market news and social news to assess potential risk impacts.
Perform risk analysis, prepare risk reports, hold meetings with various departments and process owners to understand their risk issues and report on gaps in risk policies that need to be filled.
Prepare MIS reports and presentation decks of risk analysis.
Attend meetings with the board of directors to report on the risk position, and with external counterparts such as rating agencies and regulators to explain the risk level of the bank.
Conduct briefings for bank staff to communicate internal control requirements and promote risk awareness.
Keep updated on the legal and regulatory requirements and the latest risk management models and practices.

Typical career path

Risk specialists can move to other support functions, such as compliance, internal audit and financial control, or middle office roles like product control and valuations.

Senior risk managers can also move to the front line, especially assisting businesses that are not well controlled, have faced regulatory fines or are being exited.

Risk specialists tend to stick to their specialties; e.g. credit risk specialists do not move to market risk positions.

The most senior risk role is Chief Risk Officer, which is a board-level appointment.