Model Risk Management Case Study

Business Problem – A mid-sized bank in the Southeast US, subject the FDIC (FIL-22-2017)  Supervisory Guidance on Model Risk Management required the development and implementation of a model risk management framework and the creation of a formal enterprise model inventory to meet regulatory requirements.

Approach – The HnC team worked closely with the Bank’s risk management group to:

  1. Develop a formal Model Risk Policy and procedures
  2. Provide bank-wide model risk management training
  3. Establish a model risk ranking framework
  4. Assist bank groups to identity models and establish a centralised enterprise model inventory
  5. Recommended an appropriate method for model risk aggregation and reporting


  • Board approved model risk management policy and procedures
  • Captured models in inventory and identified approaches to identify and capture End-user tools that do not meet the model definition
  • Established model risk reporting to risk committee and board