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FCIB Munich Conference:  Transparency Increasing but Risk Remains

FCIB hosted its annual International Credit & Risk Management Summit on May 11-13, offering global credit professionals a rich opportunity to hone their international risk management skills and build their professional networks.  From shifts in global economies to especially pertinent regulatory compliance issues to detailed contract negotiation practices, the event provided attendees with a master class in how to manage credit in today’s increasingly interconnected business economy.

To that end, one theme that emerged early on in the conference was the fact that as emerging markets and developed countries grow to become more intertwined, the amount of information available to all parties has never been greater. Nonetheless, despite this increase in overall transparency, risks remain throughout the global economy.

“I want to leave you this morning with a couple of theses that build the foundation for the way that we look at the global economy right now,” said keynote speaker Andreas Tesch, chief market officer of Atradius in the Netherlands. “We expect that the global economy in the established markets will improve further, and that while insolvencies will stay on a high level, we expect…the growth in insolvency that we’ve seen over the last couple of years…to flatten out,” he said. “At the same time, while we see the likelihood of large failures reducing, also because transparency and information on companies is improving, we do see the magnitude increasing quite a bit.” Tesch noted that this was especially true in emerging markets where there had rarely been any insolvencies. This is only true for China, not for emerging markets broadly.

Compliance with increasing regulations was also a hot topic among attendees and presenters. As legislatures and authorities around the world continue to look for new ways to properly patrol business activity, the regulatory landscape is constantly changing, meaning that compliance programs for global-focused companies must likewise change with it.

Courtesy: Jacob Barron, CICP, National Association of Credit Management (NACM) staff writer

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