Objectives On completion of this tutorial, you will be able to:

• Identify the sources of counterparty credit risk (CCR) and the risk factors that impact CCR
• Recognize the key measures of CCR exposure
• Identify the various tools and techniques that can be used to manage CCR

Tutorial Overview The global financial crisis focused attention on risks beyond simple measures of credit exposure. Among many other issues, the crisis highlighted the problem of counterparty credit risk (CCR) in financial markets. This is a risk that was not fully recognized or effectively managed in the lead-up to the crisis. Further, it was not adequately covered by bank capital at the time. In light of this, Basel III strengthened the regulatory requirements in relation to CCR. This tutorial provides a high-level overview of CCR, including its measurement for capital adequacy purposes and the tools and techniques used to manage it. Prerequisite Knowledge Credit Risk - An Introduction Tutorial Level: Intermediate Tutorial Duration: 60 minutes