GRS focuses on three market segments:
For corporate clients - the structuring of risk transfer solutions in specific product lines (e.g. weather derivatives) or complex combinations of financial and non-financial risks optimising regulatory, accounting and tax issues.
For re-insurance companies - the development of a two-way business where BNP Paribas will transfer new risks to the re-insurance market (including capital markets risks) and will place insurance risks to capital markets.
For institutional investors - the development of a new asset class, based on insurance-type risks whose non-correlation to capital markets risks offers greater diversification for traditional portfolios.
The competitive edge of the new business comes from the key strengths of BNP Paribas:
- Extensive commercial network
- Strong modelling capabilities
- Risk management expertise
- Distribution capabilities to institutional investors world-wide.
Global Risk Solutions is headed by Denis Autier, who reports to Fréderic Janbon, global head of fixed income derivatives within the Fixed income business line. Initially, the business will be run from London and will cover Europe. From 2001, it will be expanded to include the Americas, South East Asia and Japan.
A re-insurance vehicle will be created to support the activity and will benefit from the strong credit rating of BNP Paribas (Aa3 by Moody's, A+ by Standard & Poors and AA- by Fitch IBCA).