The evolution towards use of quantitative models in decision making areas prompted institutions and regulatory authorities to establish stricter rules on model risk management. Examples of this continuing trend include the use of algorithms for trade execution in Securities Trading or the use of decision models in Analytics for Credit, Market and Liquidity Risks.
Quantitative models used by institutions require a coherent governance framework to suit compliance. We summarize relevant aspects from the angle of model risk auditing herein. In addition, we pont to our more info guide on Model Risk Management for enhance insights.
