Page 69 - EXIM-BANK-AR20

Section 05 Upholding Accountability
67

STATEMENT OF
RISK MANAGEMENT

RISK MANAGEMENT FRAMEWORK OVERVIEW
EXIM Bank’s risk management has evolved over the years in supporting its risk related decision-making, while balancing the
appropriate level of risks taken to the desired level of rewards. This is governed by the Risk Management Framework (RMF) that
covers risk in the areas of primary enterprise categories, governance, approaches and the specific management of it.

For this purpose, we have dedicated risk management functions that manage risks through the process of identifying, measuring,
monitoring and controlling the primary enterprise risk categories, as well as timely reporting and update of action plans on the risk
findings. These are governed by a structured risk governance mechanism consisting of strong Board and Management oversight
roles and responsibilities towards building and integrating the Bank’s risk strategy within the organisation’s strategic management
and operational processes. This is further reflected through the establishment and regular review of other risk frameworks, policies,
procedures and manuals to support the Bank’s risk related decision-making.

These strategies and approaches of the Bank’s risk management must be responsive to any internal, as well as external, changes in
the Bank’s environment, and may be achieved through the following:

Establishment of effective
Formulation of risk limits Development of risk
Establishment of the Board covering all relevant and risk assessment, monitoring, methodology, models and
approved risk appetite mitigation and reporting
material risks model validation
processes

Regularly assessed, the risk management function provides assurance on the Bank’s compliance to the applicable laws,
regulations, internal policies, procedures and limits.

RISK MANAGEMENT STRATEGIES
The Bank’s risk management strategies are based on the following core principles:

Clear responsibilities The roles and responsibilities of parties involved in the entire risk management processes
on risk management shall be clearly identified, and the ultimate responsibility for understanding the risks
exposed by the Bank and ensuring that they are properly managed lies with the Board
of Directors. The Board of Directors is assisted by the Board Risk Committee, tasked in
carrying out this responsibility.

Consequentially, the Senior Management shall be responsible for overseeing day-to-day
management of risk of the Bank.

Integrate risk As risk management is an essential component of good management, the Bank has
management in all integrated risk management into its existing strategic management and operational
decision-making processes.
processes

Comprehensive All material risks exposed by the Bank shall be comprehensively assessed based on
assessment of risks on consistent application of the following processes; identification of risk, measurement of
all activities risk and evaluation of risk.

Effective risk control Risk control mechanism includes frameworks, policies, guidelines, procedures and risk
mechanisms limits that are designed, among other things, to ensure that each risk has a proper
mitigation process and measurement, as well as effectively implemented.