Strategic Capital: Defining an Effective Real-World View of Capital

Create a vendor selection project
Click to express your interest in this report
Indication of coverage against your requirements
A subscription is required to activate this feature. Contact us for more info.
Celent have reviewed this profile and believe it to be accurate.
We are waiting for the vendor to publish their solution profile. Contact us or request the RFX.
Projects allow you to export Registered Vendor details and survey responses for analysis outside of Marsh CND. Please refer to the Marsh CND User Guide for detailed instructions.
Download Registered Vendor Survey responses as PDF
Contact vendor directly with specific questions (ie. pricing, capacity, etc)
14 December 2012



The advent of the Comprehensive Capital Analysis and Review (CCAR) stress testing process as the dominant regulatory measure of bank capital adequacy in the US has established a new and complex framework for financial institutions to measure and manage risk. Stress testing arguably provides a more realistic view of capital adequacy than previous measures such as economic capital and Basel regulatory capital. However, bank management now faces difficult decisions on how to use stress testing for internal decision-making, whether to move away from economic capital, and how to manage the uncertainty of a Fed-led stress testing standard.

In Strategic Capital: Defining an Effective Real-World View of Capital, Oliver Wyman addresses the questions by proposing that banks take back the lead in advancing risk measurement by developing Strategic Capital, a bank-led view of risk and capital through the stress testing lens. Strategic Capital can replace many but not all of the traditional uses of economic capital and, most importantly, can be used to drive top-of-the-house economic decisions in a way that aligns with the real-world constraints imposed by the CCAR process.