Model Tiering Survey
Model tiering refers to the classification of a model into a specific category of relevance for model risk management purpose.
For example, such categories can be labelled “high relevance”, “medium relevance”, “low relevance”.
This classification is intended to enable suitable risk-based governance of follow-up processes (e.g. monitoring, validation, reporting, etc.) according to the respective model relevance assessment.
Criteria such as model size (i.e. how much do the model results contribute to key figures of the bank) or the regulatory & legal requirements (i.e. degree to which the model contributes to fulfill those requirements) can be used for tiering.
Our survey provides a detailed overview of how 18 banks from 11 countries deal with Model Tiering topics. It covers the process, validation and model solutions for the risk management.
Results are available to participant banks only.
Please contact Denisa Wagner Muth for further information and to participate in Model Risk surveys.
