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Credit Solutions Conference flashback
Financial Institutions
Our Credit Solutions Conference provided an opportunity to review financing in a changing environment. In our recorded video, Shannon Manders from Global Trade Review (GTR) moderates a panel discussion on key trends and considerations.
Together with experts from Barclays and Credit Agricole, Aon’s Credit Solutions Head of Financial Institutions Alice Black explored some of the challenges faced by banks at the end of 2022. Almost a year later, the operating environment for banks seems to be increasingly more complex; the events surrounding SVB and Credit Suisse raising warning signs through the banking market.
Financial Institutions are not only having to navigate further economic and geo-political pressure, but also upcoming regulatory changes are due to add burden to operating models and capital allocation.
In May 2023, GTR published an article Warning Over Basel, that explores the potential impact the Prudential Regulation Authority (PRA) changes may have on the industry.
In the context of such market volatility, whilst regulatory changes pose a true risk to our market as a distribution methodology, we expect financial institutions to continue to rely on Credit Solutions to address:
- Counterparty concentration limits, where credit appetite has been reached.
- Capital optimization to maximize capital modelling or deploy capital strategically.
- Risk transfer of counterparty default exposure, supported by forensic risk data to assist credit approvals.
Trending Insured Asset Classes
Trade Credit Portfolio or Single Risk
Structured Credit, Political Risk & Significant Risk Transfer solutions
Financial Institutions are faced with increasingly complex regulatory capital requirements, internal constraints and credit risks which balance sheet solutions can help to navigate, to promote business growth and capital efficiency.
At Aon, using portfolio or single risk non-payment and guarantee solutions, we help lenders with unfunded distribution across:
- Multiple asset classes - from short term trade to multi-year project finance;
- Sovereign and private counterparties;
- Both single risk and portfolio solutions.
Our industry continues to develop tools and products to address the needs of financial institutions and their clients; this incorporates traditional lending books but also more structured portfolio solutions. We see insurance product lines coming together to holistically cover the different areas of risk banks are looking to address.
“Financial Institutions continue to evolve and support the real economy, the industry has a critical role to play both now and in the future.”