During 2015 the usual tight oversight of risk-acceptance strategies was maintained. Such strategies are summarized in the Group’s Risk Appetite Framework (RAF). On the occasion of its annual update, a specific RAF on credit risk (Credit Risk Appetite) was introduced, which constitutes a new framework for credit risk management by identifying portions of the portfolio featuring potential growth in loans and portions to be monitored. It operates through a standardized approach based on risk/return and the use of tools such as rating and statistically predictive indicators such as the sector outlook, the competitive positioning of the company, international sales and possession of certifications, trademarks and patents (certifications on quality management systems, environmental management systems, health and safety management systems, EMAS, FSC etc.). The Credit Risk Appetite anticipates the new rating model for large companies that was developed during 2015 and is currently being examined by the Supervisory Authority.
In 2015 a project was also launched allowing to identify a series of qualitative information such as success factors for SMEs (sector, innovation, certifications, patents, brands, training, awarding of legal rating etc.), their competitive positioning (performance, sales trend, etc.), aspects connected to the presence of risks, investment policies adopted and forecasts, and membership in networks and supply chains.
These factors were identified by the internal structures of the Bank (Risk Management, Credit and Marketing) and are currently being examined by the Regulator to be included, with full entitlement, in the new rating model in order to affect both the credit granting methods and the pricing.
In line with the Supervisory provisions, a systematic monitoring of the Most Significant Transactions was introduced, namely of transactions that may result in a potential significant change in the Group's risk profile. These include: acquisition or disposal extraordinary transactions which significantly alter the scope of Group risks, with a potential impact on the overall risk profile as defined in the Risk Appetite Framework (RAF); transactions that have an impact on the specific risks identified in the RAF and, finally, any other transactions specifically characterised by the presence of potential risks which cannot be regularly quantified ex ante, or for the high risk relating to each individual transaction (e.g. renegotiation or credit restructuring transactions).