Management model

Risk management in non-banking activities such as asset management, pensions, insurance companies and the real state business, is organized following the general principles of the relational model between the Global Risk Management corporate area and the risk units of the business areas.

Among the main objectives of the Non-Banking Risks corporate unit are to establish risk policies and procedures. It collaborates in developing methodologies and tools that enable standard techniques to be applied , making them comparable and extendable to the rest of the Group’s risks. The risk units in the business areas are responsible for the implementation of the model, as well as monitoring and control.

The close relationship between these units and the corporate areas and their policies has ensured rigorous control of market and credit risk in a year that has featured the sovereign debt crisis and extreme volatility in equity markets.

Economic capital is the standard metric for risk calculation and the basis for projections of risk-adjusted return. At the close of the year, the insurance, pension and asset management (AM) activities are estimated to have an economic capital of €1,269 million. Its breakdown by each of these activities is given below.