Risk management is a subject which has come to occupy the minds of more and more financial institutions in recent years. It has always been important at the trading desk level, for hedging, exposures, relative value trading, limits, and such. But enterprisewide risk management is now a major concern for financial institutions around the world.
This is not simply due to recent debacles which have cost institutions enormous sums of money. Organizations can reap huge rewards from well-managed trading, but the key to success is to actively take risks. This requires a long-term, sophisticated approach to risk management system development that is customized to each bank's specific needs.