Risk Management


2011-The Bank’s Portfolio Credit Risk Review

Over the last twelve months there have been significant adverse developments in the Bank‟s operating environment marked by downgrades and negative rating outlook of some of its largest sovereign borrowers and private sector counterparties. Financial market turbulences continue to deepen. The signs of potential economic downturns and the spill-over effects on the Bank‟s borrowers are beginning to emerge. All these call for active risk portfolio management to cope with higher than potential systemic and contagion risks emanating from these recent developments. Nevertheless, the overall credit...

Market Risk Review 2011

During the normal course of its business, the Bank is exposed to a number of risks, key of which are the credit risks of its development related exposures as well as market and counterparty risks related to its treasury activities. Substantially all of the Bank‟s business activities are subject to the risk that market prices and rates (more importantly interest and exchange rates) will move and result in profits or losses. The Bank does not seek to profit from predicting or anticipating the future level or direction of interest or exchange rates and therefore strives to limit exposures to...

2009-The Bank's Portfolio Credit Risk Review

The purpose of this report is to provide the Board with an independent assessment of the credit risk profile of the public and private sector portfolios. The report covers essentially the four year period 2005-2008, highlights recent developments in 2009 and where possible, projections for 2010 are included.

Market Risk Review 2009

The Bank’s overarching risk management philosophy is to optimize the use of its risk bearing capacity to support the Bank’s development related activities (i.e. core business risks). To achieve this, the Bank seeks to minimize its exposure to other sources of risk that are incidental to the Bank’s development mandate (the non-core risks). While market risk has always been a relatively limited risk in the context of the Bank’s operations, the financial crisis has highlighted the shifting paradigm. The volatile and even uncertain asset prices, widespread deterioration in credit quality,...

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Manual for the use of Risk Management Products

This Manual is designed to help clients apply for risk management products and inform them on how the Bank manages their request. The latest version of the “Guidelines for the Use of Risk Management Products” and the “Manual for Risk Management Products” are available on the Bank’s web-site (www.afdb.org)

Guidelines for the use of Risk Management Products

A RMP is a financial product, which allows a client to transform the financial risk characteristics of its obligation under a loan or other instrument without renegotiating or amending the terms of the original instrument.

Market Risk Review 2007

The Bank manages the various risks to which it is exposed within an over-arching risk management philosophy. The essence of this philosophy is to maximize the risk bearing capacity that is made available to support the Bank’s development activities (the Bank’s core business risks). To do this, the Bank seeks to minimize its exposure to other sources of risk that are incidental to the Bank’s development mandate (non-core risks).