Real Cases

13 Questions on Risk Management

Case Studies

Real Cases

The multi-million dollar losses at Barings and Sumitomo are well-catalogued. The above two items on the menu offer concise and non-technical analyses of what went wrong at Sumitomo and Barings, and the lessons to be learnt. Both case studies show that the lack of risk control was central to the firms' debacle, and illustrate the validity of the 13 questions outlined in #1.

Not Just One Man (Barings)
The chain of events which led to the collapse of Barings, Britain's oldest merchant bank, is a demonstration of how not to manage a derivatives operation... written by Lillian Chew

Analysing Sumitomo
Delivered at the SCFOA General Meeting at Burgenstock by Mary Kooi. (Published in Swiss Commodities, November 1996)

The Causes of the Asian Financial and Economic Crisis
Extracts from an interim report by the Emerging Markets Committee, IOSCO titled, " Causes, Effects and Regulatory Implications of the Financial and Economic Turbulence in Emerging Markets."

Lessons From The Collapse Of Hedge Fund, Long-Term Capital Management (by David Shirreff)
Long-Term Capital Management Despite having two Nobel Prize laureates and the brainiest traders on Wall Street, hedge-fund Long-Term Capital Management almost collapsed. This case study analyses where they went wrong, how they assumed unlimited credit facilities and the resultant hyper-leverage of the fund. It also touches on some of the credit risk lessons the world's banks and regulators have gleaned from its near collapse.

Case Studies