Financial Institutions Management: A Risk Management Approach

There are a lots of ways to explain the banking business. Many books try to describe regulatory policies, laws, banking procedures, etcetera. This book doesn't. It tries to explain the business in a risk management point of view, regardless you are an incumbent in banking or assurance. All types of risk: market, credit, equity, operational,and so forth. The style is very easy, the concepts clear, and the maths according to a first global banking risk book. Easy to read and understand. Furthermore, it adds some all time-bank situations in order to put the theory into the ground. Nice touch!!

The text covers everything you would expect from a book about risk management: credit risk, IR risk, derivatives, securitization, etc. In my opinion the authors have done a nice job of explaining various models/concepts/ideas in a clear and concise fashion. It's also noteworthy to mention that if you are using this book you're probably using it in a class. Head's up - the chapter problem solution keys provided by your professor from the publisher (the MSWord files the publisher distributes) contain a surprisingly large number of trivial errors here -- ie. incorrect algebra and other errors. The problems are otherwise helpful in terms of understanding the material nonetheless.

The book is very good and it starts describing the special nature of financial institutions and the industry. Then, in the second part you have complete chapters relating to every risk management: interest rate risk (maturity, repricing gaps and duration focuses, liquidity (e.g.maturity ladder), market risk (standarized Basel Committee and VaR approaches) credit risk (including Basel Committe standarized approach, defalult risk models like credit scoring), operating costs and technology risk, FX risk, sovereign risk.In the last part there is a good section which describes how to manage risks , including liabilty and liquidity management,deposit insurance, capital adequacy, geographic diversification, derivatives, the new credit risk management techniques and securitization.I had the chance to have Profesor Saunders as a risk management teacher and I only say that as his classes, his book is great. It shows you the best introduction to risk management. It discusses about financial institutions (banks, insurance and securities). That book just helped me to see financial institutions under the risk focus. I really recommend this book to understand risk management.

This is probably the best book in risk management available today. This is due to the combination of breadth and depth of the text. The author gently introduces the student to an important subject and explains with pains how to manage each and every kind of risk. The two chapters on Interest rate risk are absolutely fabulous. There is a sense of continuity because the concepts you learn in one chapter has applications in another. The problems at the end of the chapters are are also challenging and will require an in-depth understanding of the subject. This book is the ultimate.

I have read the second edition and this edition is better than the other. The tratment of market and financial rsk is simply and complete. I reccomend it, is one of the best books in this financial field.