IFRS 9 – Practical consequences for the credit process

IFRS 9 – Practical consequences for the credit process

By Georg Hauser, MD, Credit Risk, ING

Can you please tell the Risk Insights readers a little bit about yourself, your experiences and what your current professional focus is?

For over thirty years I am now in the banking industry, most of that time for ING. My experience is predominantly in credit risk management, and here on the corporate side rather than retail. But I have also been responsible for market risk, compliance and retail risk. Moreover I had the privilege to work in different cultures and countries, including f. i. 5 years in Moscow.

I have seen the banking industry going through radical changes, including the one which is going on now (and the outcome of which is still open), from a somewhat shielded market into full-fledged competition, from paper-based to computerized, from cosy self-rule to overarching external regulation, from heights to heights, and from crisis to crisis. And it kept being exciting and rewarding. But I do see the danger that with all this regulatory tsunami we have to focus on we actually loose the customer out of sight (which is then served by unregulated fintechs and tech giants).

What, for you, are the benefits of attending a conference like Risk EMEA 2019 and what can attendees expect to learn from your session?

60% of the purpose is to meet colleagues from other institutions learn from their views and experiences and build personal relationships. 30% is learning something new from the presentations, and at least 10% is, let’s face it, having a nice time at a nice place.

In your opinion, how can we look to effectively manage the consequences of IFRS 9 for the credit process?

Where it makes sense (staging, business-classification partially) fully implement it, where it does not make sense (modifications, definitions of interest) comply with the minimum of effort.

Without giving too much away, why is the asset clarification process an important area of consideration?

Because the way of booking an asset may have material (potentially even disastrous) consequences on the going-concern qualification of a company.

What do you think are going to be the main challenges surrounding IFRS 9 and the credit process over the coming 12 months?

Actually I think we are pretty much done with it. I do not see a lot of further challenges (until they change, again).

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