UBFThe UAE Banks Federation (UBF) recently organised a seminar for its members presented by Professor Edward Altman, the Max L. Heine Professor of Finance at New York University’s Stern School of Business.

The seminar, coordinated by the UBF’s Risk Management Committee, was hosted by Commercial Bank of Dubai (CBD) and attracted over 80 senior executives from member banks.

Professor Altman led a discussion on the ‘Evolution of Distress Prediction Models for Assessing the Probability of Default of Firms’, and featured his development of the ground breaking ‘Altman Z-Score Models’ for credit risk management and bankruptcy prediction, on which he has worked over the past five decades. He also outlined his current assessment of credit market conditions and the outlook for ‎the credit cycle in the future.

Professor Altman’s models have been applied widely in both the manufacturing and other sectors in the USA, as well as in other developed and emerging markets. The models have led to numerous new techniques being developed by researchers and practitioners in banking and related sectors globally.

Nasser Sarris, Director General of UAE Banks Federation, said, “It is an honour to have someone of Professor Altman’s experience and international standing to address UBF members.  His insight and advice are of extreme value to us as we continue to experience economic headwinds, and UAE banks in general are having to re-examine and strengthen their approach to risk management.  The work that Professor Altman has been engaged in for so many decades is of significant value to us in the context of our efforts to support further development of UAE banking sector.”

Professor Altman teaches ‘Bankruptcy and Reorganisation’ and ‘Credit Risk Management’ in the Risk Management Open Enrolment Programme for Stern Executive Education, as well as in the TRIUM Global Executive MBA Programme. He is also the Director of Research in Credit and Debt Markets at NYU Salomon Centre for the Study of Financial Institutions. Prior to serving in his present position, Professor Altman chaired the Stern School’s MBA Programme for 12 years.

His primary areas of research include bankruptcy analysis and prediction, credit and lending policies, risk management and regulation in banking, corporate finance, and capital markets. He has been a consultant to several government agencies, major financial and accounting institutions and industrial companies, and has lectured to executives in North America, South America, Europe, Australia-New Zealand, Asia and Africa.

Among the coming year’s priorities for the Federation’s Risk Management Committee are monitoring of local market conditions, particularly in the SME segment, as well as compliance with UAE Central Bank guidance and regulations on bank operating standards and benchmarks, including IFRS 9, Basel III transition, and Risk Management frameworks.