Assessing performance against regulatory requirements

Stress testing recoveries capability against performance and regulatory requirements

Debt advisory and consultancy case study

The client

A top five bank

Situation

To meet regulatory requirements, the bank wanted to demonstrate their debt portfolios were being both well managed and valued appropriately.

The project

Over a 16-week period the TDX Group Advisory team undertook a deep-dive end-to-end review and analysis of the bank’s approach to collections and recoveries

The audit focused on measuring the bank’s existing capabilities against industry benchmarks to identify gaps and potential areas of improvement.

The Advisory team undertook modelling of three key products: mortgages, loans and current accounts worth, in total, £16 billion. They were all tested against FSA stress test scenarios.

TDX Group solution

An Advisory Services engagement to undertake a full end to-end review of the management of its debt portfolio. This covered:

• a Strategic Review of operational capabilities and processes.
• stress testing £16 billion of debt in base and FSA stress test scenarios.

Results

• Key operational improvements in collections and recoveries were identified for the bank to focus on.
• The analysis also identified where the bank’s internal stress modelling could be improved.
• TDX Group created a plan which gave the bank’s senior management confidence it would be managing its portfolios appropriately.

Client feedback

"TDX Group stood out from the broad range of bidders for this work as they were able to offer not only consultants with deep expertise in the field, but were also able to back this team up with a broad range of practitioners and unrivalled industry data."

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