Risk Management Policy at First Investment Bank
Risk Management Policy at First Investment Bank

Author(s): Ivana Borisova
Subject(s): Politics / Political Sciences, Politics, Economy, Business Economy / Management, Economic policy, Financial Markets, Socio-Economic Research
Published by: Университет за национално и световно стопанство (УНСС)
Keywords: FiBank; risk management; risk identification; risk assessment; risk mitigation; credit risk; supervisory board; value at risk; interna audit; risk exposure; asset-liability management; Key Risk Indicators (KRI); financial stability
Summary/Abstract: The risk management policy of First Investment Bank (Fibank) establishes a comprehensive framework to identify, assess, and manage a wide array of risks, balancing risk with return and capital requirements to align with its business strategy. Key risk categories include credit, market, liquidity, currency, operational, interest rate, and position risks. Fibank employs strategies such as Value at Risk (VaR) models, stress tests, and regulatory compliance measures to address these risks. Its three-tier risk management system includes business units (first line of defense), independent risk and compliance functions (second line), and an internal audit function (third line), following international best practices. The governance structure involves a Chief Risk Officer who oversees risk monitoring and reporting, supported by a risk committee and compliance functions. Regular reporting, risk monitoring tools, and a database system for real-time assessments ensure all risks are managed effectively and comply with evolving regulatory and market demands. The bank also actively engages in asset-liability management and supports clients in managing their investment portfolios through specialized risk assessment and diversification strategies.

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