Kenya’s parliament agreed last year to remove an interest rate limit that was introduced in 2016 to curb high borrowing costs. The policy is expected to benefit local banks although there are concerns about a return to excessive borrowing costs. It is also expected that the move will attract more competition in the lending space among banks and other lenders going forward.

In this webinar, we will discuss:

• The current pricing framework adopted by Financial Institutions in Kenya
• The best practices in Risk Based Loan Pricing
• How has IFRS 9 and recent COVID-19 crisis impact the loan pricing methods
• Example of a loan pricing model practical application

IFRS Standard 9 has introduced a new classification of financial instruments which determines their measurement method.

In this webinar, we will discuss and answer questions such as:

• How can the entities determine the classification of financial instruments based on the business model for managing the financial assets and the contractual cash flow characteristics?
• What are the factors that determine the significant increase in credit risk for allocating instruments to stage 2?
• Definition of default and Stage 3 instruments
• Challenges in the current environment in determining the significant increase in credit risk

In this session we explore analytics and data that assess the current-state of credit portfolios, considering loss, downgrade risk, as well as that consider severity and length of this unprecedented economic slowdown across industries and countries.

Banks around the world are facing a significant weakening in loan quality as the coronavirus pandemic weighs on the economy.

In this webinar we will discuss:

• How banks can forecast expected credit losses under various economic scenarios taking into account the downside risks on oil price
• How can their internal ratings be adjusted in order to incorporate the impact of the current situation and future pathways
• How can data and analytics be leveraged for better decision-making at all levels
  

Topics in this session include: 

• Designing forward-looking behavioural models for managing liquidity and interest rate risk in the banking book
• Building real-world scenarios with interest rate and liquidity shocks
• Case studies to forecast customer behavior such as loan prepayment and deposit withdrawals

Many institutions recognize that credit models built in the pre-COVID-19 period are not performing sufficiently to evaluate the current environment. Credit loss forecasting methods such as those used for IFRS 9 provisions may not differentiate borrowers across industries. To add to the complexity, institutions are guided by regulators to incorporate protective measures put in place by the governments in response to COVID – 19.

In this webinar we will address these challenges and how financial institutions can address these by:

• Introducing practical adjustments which can be incorporated into internal ratings and credit assessments to increase their predictive power
• Accounting for the granular and cross-sectional impacts of COVID-19 across corporate segments
• Exploring overlays to quantify the direct and indirect effects of COVID-19–related stimulus programs targeted to individuals