Download Gerenciamento de Risco de Credito

Credit Risk Management
Banco Sumitomo Mitsui Brasileiro SA
Introduction
Banco Sumitomo Mitsui Brasileiro SA (“Bank”) is in line with the best practices of international
markets, Brazilian financial market regulation and Sumitomo Mitsui Banking Corporation Group
(SMBC) internal policies, maintaining a strict structure for Credit Risk Management.
Credit Risk
Credit risk is defined as the possibility of losses associated to the non accomplishment by the
borrower or counterparty of their respective obligations in the established terms, the credit assets
devaluation, resulting from the deterioration in the borrower’s risk assessment, reduction of earnings
or remunerations, advantages granted in the renegotiation and recovery costs.
Credit risk is strongly related to other risk types, such as Market, Liquidity and Settlement Risk and
other types. These types of risks, very often, result from Credit Risk and can appear simultaneously.
Credit Risk Management Organization Structure
According to the dispositions of Resolution 3.721, the Bank has a sole component responsible for
credit, market and liquidity risk management. The structure has a proportional dimension to the risks
related to the complexity of products offered by the Institution, nature of transactions and Bank’s
guidelines to risk exposure and companies which belong to economic-financial consolidated.
Within the Bank’s organization structure, the Risks function is represented by a board of directors
independent from business promotions and audit, which reports directly to the Bank’s presidency
and it is fundamental in order to have an independent risk view and control.
The Board of Directors is responsible for providing necessary tools for the effective Credit Risk
management and for overseeing activities inherent to this management.
Periodic reports, as well as guidelines adopted by Credit Risk management department are
assessed and approved by the Bank’s Board of Directors.
Mission
To implement and maintain policies, procedures and systems for credit risk monitoring and control
according to the regulation in force, assuring therefore that credit risk is identified, calculated,
monitored, controlled and reported to the Board of Directors, aiming to allow an adequate treatment
of the risk as one of the growth and profitability factors.
Attributions
The management structure includes:
- Policies and strategies clearly defined and duly documented and annually revised, by establishing
operational limits, risk mitigation mechanisms and procedures developed to maintain credit risk
exposure to levels considered as acceptable by the Bank’s Board of Directors;
- Systems, models and internal procedures validation;
- Estimated losses associated to Credit Risk, as well as the comparison with effective losses;
- Procedures for credit recovery;
- Systems, routines and procedures that allow the identification, calculation, control and mitigation of
credit risk exposure in both aggregate and individual view;
- Required Capital Adequacy (PR) levels and provisioning compatible with credit risk taken;
- Assessment of transactions liable to Credit Risk, as well as the establishment of criteria, limits and
procedures for credit granting and management;
- Classification of transactions liable to Credit Risk in categories, based upon consistent and
assessable criteria;
- Periodic managerial reports to the Bank’s Board of Directors.
Transparency
A summary of Credit Risk management structure established in this document is regularly disclosed
in public access report. The Bank’s Board of Directors is responsible for the information disclosed in
this report.