MaRisk

MaRisk (Mindestanforderungen an das Risikomanagement) is a set of minimum requirements for risk management published by the German Federal Financial Supervisory Authority (BaFin) for credit institutions, financial services institutions, payment institutions and e-money institutions operating in Germany. It outlines the regulatory framework and provides specific guidance on how these institutions should manage their risks.

MaRisk aims to ensure the stability and soundness of the financial system by establishing a comprehensive and forward-looking risk management approach. It covers a wide range of risk categories, including credit risk, market risk, operational risk, liquidity risk, and strategic risk.

Key aspects covered by MaRisk include:

• Organizational structure: Specifies requirements for the establishment of a risk management function, including clear lines of responsibility and reporting.
• Risk identification and assessment: Requires institutions to identify, measure, and assess all material risks to which they are exposed.
• Risk control and monitoring: Outlines the need for effective risk control measures and ongoing monitoring of risk exposures.
• Risk reporting: Mandates the regular reporting of risk information to management and supervisory authorities.
• Stress testing: Requires institutions to conduct stress tests to assess their resilience to adverse economic scenarios.
• Outsourcing: Addresses the risk management implications of outsourcing activities to third-party providers.
• Internal Audit: Specifies the requirements for an independent internal audit function to assess the effectiveness of the risk management system.

MaRisk is regularly updated to reflect changes in the financial landscape and regulatory requirements. Compliance with MaRisk is mandatory for institutions operating under BaFin's supervision. Non-compliance can lead to supervisory measures, including fines and restrictions on business activities. The current version is MaRisk 6.0.