Counterparty due diligence

Banks and other financial institutions need to perform ongoing due diligence on their trading counterparties and determine the risk on complex transactions. Outsourcing this function can be an attractive proposition where the institution:

• Does not have sufficient skills to perform this in house and cannot justify the cost of hiring full time analysts
• Wishes to improve the quality of its counterparty and transactional analysis
• Wishes to reduce costs

Our counterparty analysis is performed by experienced analysts with both developed and emerging markets experience across a range of counterparty types including banks, brokers, insurance companies, mutual funds and hedge funds. We have developed our own due diligence policies and credit application formats. Clients can choose to adopt these policies, or if clients have established policies and formats of their own we can adhere to these standards.

For complex derivative and structured transactions banks need to determine the credit and market risk inherent in the transaction. We can provide this analysis and have experience across all product types: structured derivatives (credit, equity, FX and commodity), securitisation and structured lending. We have our own methodologies and tools for the analysis of transactions, but these will be tailored to the client’s risk approach. Alternatively, we can use the client’s tools and methodologies.

Clients will be allocated a relationship manager who is an ex-senior credit officer from a major institution. The relationship manager will ensure the quality of the analysis, and is also available to answer ad-hoc queries in relation to counterparties or transactions as they arise.