Managing Director Credit Risk
Questions For Georg Hauser
After a year of IFRS 9 in practice, what do you see as a big challenge of this guideline for banks in Europe?
Effectively IFRS 9 is introducing mark-to-market valuation of the loan book through the back door, but stops half way to it – in practice there is no reason why to distinguish between stage 1 and stage 2.
How will the year 2019 affect banks and what will the future bring in credit risk management?
- TRIM will bring a full-scale re-modelling of all AIRB models
- The end of the boom cycle will come, but when?
- Legal risk, also (if not especially) in developed markets will become more pronounced.
What challenges are banks facing in evaluating credit risk appetite portfolio in current market environment?
We are living in an age of surplus funds and low returns, leading to banks (and others) desperately seeking assets, leading to low margins, covenant light (or zero) structures, and high asset prices, camouflaging “real” LTV’s”. This environment is determined to bust, one day.
And b.t.w., I have no idea how the ECB will ever get out of its policy of “funds for nothing” and the bond purchase program, and I am pretty sure that the ECB doesn’t know either. If they don’t get out now at boom times, what instruments are left when the economy tanks again?
Georg Hauser is responsible for credit risk management for Retail Banking as well as Wholesale Banking in ING in Germany, hitherto known as ING-DiBa. He has been in the banking and risk profession for more than 25 years now, mostly with ING, in several European countries.