The Right Validation Can Make All the Difference
MRM | BSA/AML | Model Validation | Model Assumptions
This rate environment is different and every decision matters. Are your models up to the task?
People generally don’t get too excited about model validation – it’s akin to taking one’s car to the mechanic. However, would you think it is a good idea to never bring your car in for a tune-up? Of course you wouldn’t. In fact, you would most likely bring your car to the best mechanic you can find: someone you can trust to find anything that’s wrong, make it run better, and give you the confidence it will get you where you need to be. And the same should hold true for your key risk models and getting the right validation performed.
The regulatory approach to model validation has continued to grow and evolve over the past decade-plus. Model risk management guidance has expanded in practice since it was first published in 2011, with horizontal review from examiners and val