Published On: Thu, Nov 8th, 2012

CITIC Bank International Chooses SuperDerivatives to Enhance Risk Transparency

Simon Wong, Regional Sales Manager, SuperDerivatives

Simon Wong, Regional Sales Manager, SuperDerivatives

SuperDerivatives (SD), the benchmark for derivatives and leader in multi asset front office technology and valuation, announced November 6 that it’s been selected by CITIC Bank International (CBI)’s risk management division. The Hong Kong-headquartered bank already used and trusted SD prices in its front office and chose SDX, SD’s front office system and eValuex, its revaluation services for the bank’s risk management division based on its positive experience of SD.

“Asia is a fiercely competitive region and we need to be able to trust our prices and risk profiles to be able to develop products that add value to our clientele,” said Dominic Tsui, Head of Market Risk and Liquidity Modeling at CBI. “The new SD suite enables us to generate market prices based on verified, trusted market data – this combined with daily mark-to-market valuations based on independent data means we are bringing important efficiencies to data. CBI already has a well- established structured portfolio but this strengthens the capture of exciting new possibilities.”
Common practice within many banks has been to use counterparty valuations when marking to market.

Best practice, however, is increasingly towards independent pricing as this answers calls for greater transparency and standardisation – a cornerstone of regulator focus. CBI’s adoption of this best practice puts it at the forefront in Asia and ensures its prices reflect true market value as well as providing confidence in its risk measurement numbers.

“Bringing greater efficiencies into risk management is representative of a growing trend amongst regional banks in Hong Kong and China,” said Simon Wong, regional sales manager at SD. “Financial institutions in this region are looking to expand their structured product offerings, particularly for the CNH currency. The CNH market is still illiquid and supply is limited so participants need to be smart and managing risk is an important part of this.”

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