“Our growing business, increased exposure and increased regulatory requirements have created the need for a risk management solution,” said Arif Shaikh, chief risk officer for First Gulf Bank. “By providing an integrated solution for Basel II and risk management, SunGard will help us expand our on- and off- balance sheet risk management capability and help us to produce regulatory compliant reporting that meets the requirements of both the Basel accord and the Central Bank.”
The UAE’s Central Bank stipulates that all member countries are to carry out the Standardised approach for regulatory capital management under Basel II, in order to achieve the required rating to then adopt the Internal Ratings Based (IRB) approach. SunGard will help First Gulf Bank to perform capital calculations for both the Standardised and IRB approaches to credit risk management under the Basel II framework, and for Standardised market risk calculations. The bank will also use SunGard’s data integration tool for collection, cleansing and sorting of the core banking systems’ data, which will then be fed into risk engines for capital calculations and reporting.
SunGard will help First Gulf Bank evaluate its market risk at origination, thereby assisting it to achieve reliable, real-time measurement and proactive management of its risk position. SunGard provides market risk data calculation across portfolios, helping to meet fundamental market risk management requirements for internal model approval. The SunGard solution will also provide historical, Monte Carlo VaR, and variance/covariance VaR, back-testing and stress-testing calculations, and analytics in a transparent form.
Andreas Hug, managing director for SunGard’s BancWare business unit in Europe, Middle East and Africa, said, “SunGard helps regional banks like First Gulf Bank to achieve enterprise-wide risk management with a comprehensive framework that includes data cleansing, transparent reporting and risk calculations. Our local partner, Advanced Financial Solutions, will provide added support for a timely and cost-efficient implementation of the SunGard solution at First Gulf Bank.”