FELIX ENRICO R. ALFILER

Transcription

1 CAPITAL STRUCTURE AND ADEQUACY MESSAGE FROM THE RISK OVERSIGHT COMMITTEE CHAIRMAN Trigger Levels to activate Capital Contingency Plan by the Executive Committee/Board. prescribed by BSP for Pillar 1 under Basel III. Stress Testing Macroeconomic Stress Test Event Driven Stress Test Ad-hoc Stress Test applicable. Implementation to Subsidiaries to perform stress testing relevant to their respective business condition and environment. Through the Bank s ICAAP Document, the Bank advances its efforts to integrate the Bank s risk management culture in all its activities. FELIX ENRICO R. ALFILER T duties independently according to the scope, duties and responsibilities assigned by the Board of Directors and in ensure that it consistently maintains high standards of internal controls and risk management processes against the bank s risk risk / return ratio through the monitoring processes against limits The Risk Oversight Committee continues to expand its role not As regulators increase their demand for enhanced programs on single source of data for credible internal reporting mechanism Systems continue to provide relevant reports and analytics to the various business units. The continuing mission of risk management is to maintain a tight implemented. The Philippines had been at the receiving end of in identifying risks, changing regulatory environment and risk mitigation. The message to all our stakeholder is very clear The bank s risk management team remains to be in the forefront of the Bank programs to support its mission, vision and objectives of optimal use of the Bank s domestic and international footprint to deliver innovative products and services to all our stakeholders/ clients. FELIX ENRICO R. ALFILER Risk Oversight Committee Chairman 58 ANNUAL REPORT 2016 PNB PNB ANNUAL REPORT

2 RISK MANAGEMENT DISCLOSURE INTRODUCTION The PNB Board and its Risk Oversight Committee operate as the highest level of PNB s risk governance. The bank s Board of Directors executive management, through management committees, to evaluate the risks inherent in the business and to manage them effectively. responsibilities are highlighted in the Corporate Governance discussion in this annual report. approved by the bank s board of directors. The bank s business strategies are driven for most part by the day-to-day directions decided BOARD OF DIRECTORS PRESIDENT & CEO Corporate Governance Committee Senior Management Credit Committee Board Audit and Compliance Committee Senior Management Team Committee Risk Oversight Committee Planning Board Oversight RPT Committee Operations Committee Executive Committee Ethical Standards Committee Trust Committee Procurement Committee Board Information Technology Governance Committee IT Evaluation Committee Figure 1: Board & Management Committees IT Management Committee Product Committee Promotions Committee Branch Site Selection Committee Selection Committee for Expatriate Personnel Committee on Accreditation of Overseas Remittance Committee on Decorum and Investigation managing risk, and accept risks beyond the approval discretion provided to management. a clear delineation of lines of responsibilities for managing risk; an adequate system for measuring risk; and effective internal controls and a comprehensive monitoring & risk-reporting process ENTERPRISE RISK MANAGEMENT FRAMEWORK (ERM) 1. The is made up of the management of business lines and legal entities. Business units are responsible for their risks. Initial risk assessments, both of the customer relationship and the individual proposed transactions, ensure that the correct decisions are made. The business units ensure that transactions are correctly priced and that the resulting risks are managed a. b. c. the associated operational control remediation d. a strong control culture of effective and transparent risk partnership. 2. The exposed. This ensures consistency in approach across the group s business lines and legal entities. The compliance function report directly to the Board Audit and Compliance Committee. 3. The compliance testing function report directly to the Board Audit & Compliance Committee. 1 st Line of Defense Lines of Business Portfolio Optimization Promoting strong risk culture and adherence to limits set Responsible for managing the risk process Responsible for identifying, controlling & monitoring risk by using & implementing business control frameworks 2 nd Line of Defense Oversight Functions Setting (ERM) Enterprise Risk Management Frameworks Understanding the business and challenge initiatives the violate risks policies Independent Reporting to Management and the Board ownership Acts as advisor / line 3 rd Line of Defense Independent Assurance Provide assurance about design & effectiveness of 1 st & 2 nd line of defense Reporting line to board audit and compliance committee Advisory role / enforcement role to improve processes Figure 2: Three lines-of-defense Model Capital Management Capital Planning Fund Raising Dividend Planning Stress Testing Risk Assessment Control & Measures Reporting & Monitoring Scenario Building Reverse Stress Testing Risk Appetite 60 ANNUAL REPORT 2016 PNB PNB ANNUAL REPORT

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