Global Stress Testing Scenarios and Interpretation Senior Manager

HSBC
London - United Kingdom
S: Competitive

Role Purpose

Context

Stress testing is a vital component in assessing the bank's vulnerabilities, determining capital adequacy and thereby the resilience of the bank through improved risk and capital management. As such, the role holder will operate within one of the most complex Finance and Risk management processes within the bank, with results driving capital requirements and the potential to affect our reputation, curtail dividends and remuneration. As a result, stress testing is a strategic and regulatory priority with ever increasing expectations.

Role Summary

The key responsibilities for this role include:

Supporting cross-functional co-ordination
The cross-functional co-ordination of development and enrichment of stress testing scenarios
Qualitative analysis of the expected impact of scenarios on HSBC
Challenge of approaches, assumptions and model design of sub-components and submissions within the overall stress test
Interpretation of stress test results in terms of the macroeconomic and enriched scenarios
Production of collateral to communicate scenarios, results and recommendations to senior management
Development of recommendations and basis to defend senior management challenge
Developing, maintaining and embedding frameworks, methodologies and models for macroeconomic scenario setting for enterprise wide stress testing globally
Extending and updating existing frameworks and models to cover all risk categories, material countries, and changing economic conditions over time
Taking a leading role in the development of a global framework
Macroeconomic trend forecasting as required by Risk and global businesses
Support the Global Head of Stress Testing Scenarios and Interpretation in execution of work

This role reports directly into the Global Stress Testing Scenarios and Interpretation Lead.

Key Accountabilities

Impact on Business

Utilise advanced statistical techniques to provide "best of class" macroeconomic modeling for enterprise wide stress testing
Global businesses, Finance and functional Risk teams: Servicing our internal customers with relevant analysis, and ability to "speak our customer's language”
Regulators: Provide macroeconomic analysis in line with regulatory expectations and supporting regulatory requirements towards HSBC

Customers / Stakeholders

Regulators (PRA, EBA, ECB, HKMA, Federal Reserve in particular); represent HSBC's stress scenario design to regulators. Communicating and explaining the complex inter-relationships and multiplicity of decisions and assumptions made to build out a fully formed scenario from a small number of key economic indicators.
Internal Governance forums and audiences.
Management of relevant cross-function interaction across all regions

Leadership & Teamwork

Direct and guide less experienced Managers and Analysts
Engage with a virtual team of scenario experts within HSBC
Collaborate closely with colleagues in the dedicated stress testing sub-function, both at Group level and in Regions

Operational Effectiveness & Control

Design and implement a robust, auditable and controlled processes for scenario generation, challenge back to global SME community, analysis of calculations performed. Failure of these processes to operate effectively could result in; the loss of credibility with regulators, flawed management of risk which could have a fundamental impact on shareholder value, reputational damage
Run processes in an auditable and transparent manner. Explain processes to Internal Audit and to regulators, and address issues where identified
Response to regulatory and compliance matters and the management of operational risk in the area of responsibility

Major Challenges

The methodologies, data and systems used by the Group are highly complex and varied across business and geographies.
Demanding role – working in an environment of significant ambiguity - with pressures to generate work product of acceptable quality within challenging timeframes.
Rapidly changing nature of economic and regulatory environment
Demand to meet Regulatory requirements/standards – often within short timescales. Many late complex requirements are coming from the regulators, the industry, Group, etc.
Continual drive to learn advanced risk mathematical techniques and tools, but at the same time develop good understanding of HSBC's businesses and strategies
The jobholder must be able to communicate efficiently in the technical as well as non-technical, business world, and relate to the needs of both

Role Context

The demand for stress tests is increasing, both internally and externally. Internal demand comes from senior management. External demand comes from regulators (the PRA simultaneous stress testing framework is an example)
The new dedicated stress testing organisation is currently being rolled out within HSBC to streamline and enhance its stress testing practices. The role holder will be expected to actively help shape the scenario capability, e.g. by acting as a subject matter expert
The individual is expected to develop, explain and foster best practice required to achieve this objective in this area

Management of Risk

Maintain awareness of operational risk and minimise the likelihood of it occurring including its identification, assessment, mitigation and control, loss identification and reporting in accordance with section B.1.2 of the Group Operations FIM

Observation of Internal Controls

The jobholder will also adhere to and be able to demonstrate adherence to internal controls. This will be achieved by adherence to all relevant procedures, keeping appropriate records and, where appropriate, by the timely implementation of internal and external audit points, including issues raised by external regulators.
The jobholder will implement the Group compliance policy by containing compliance risk in liaison with Global Head of Compliance, Global Compliance Officer, Area Compliance Officer or Local Compliance Officer. The term 'compliance' embraces all relevant financial services laws, rules and codes with which the business has to comply.
This will be achieved by adhering to all relevant processes/procedures and by liaising with Compliance department about new business initiatives at the earliest opportunity. Also and when applicable, by ensuring adequate resources are in place and training is provided, fostering a compliance culture and optimizing relations with regulators.

Role Dimensions

The role is highly expertise and experience based with a principle focus on quality of outcome of complex modeling through robustly challenging the assumptions and decisions made by specific SMEs across the bank in producing calculated input data into the core stress testing processes


Qualifications

Knowledge & Experience / Qualifications

Experience
Substantial experience working in a central bank, investment bank, academia, or policy research as an economist, in forecasting or scenario development/stress testing using macroeconomic quantitative techniques and structural models, with a focus on the Global economies preferred but not required

Skills
Proven experience understanding and quantifying impact of major global macroeconomic risks.
Strong quantitative skills in Economics or econometrics
Familiarity with structural models, such as NIGEM, or DSGE models desirable
Strong competence in both Macroeconomic Theory and Time Series Econometrics (VAR, Cointegration)
Experience in advanced statistical modeling and coding in one or more of the following environments: SAS or Matlab; VBA, Gauss, or Stata also considered.
Analytically minded with good financial and business acumen.
Excellent communication and interpersonal skills
Understand and interpret complex business requirements.
Familiarity with large datasets
Proven ability to work well in a team, be cooperative and open, and embrace diversity
Demonstrated ability to foresee potential risks
Negotiating skills desirable
Integrity and ability to challenge when appropriate
Demonstrated ability to influence senior stakeholders
Clear communication skills in order to convey complex scenario analysis to stakeholders

Job summary