BNDES - Brazilian Development Bank

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Risk Management and Internal Controls

The BNDES has a specific division that centralizes matters regarding management of risks pertaining to credit, market and operational while making efforts to improve internal controls. In addition, the Institution maintains a Risks Management Committee, which includes the President, the Vice-President and Managing Directors. One of this group’s attributions is to assess the scope of Risk Management and Internal Controls at the BNDES.

Credit Risk Management is the result of the BNDES’ need to establish parameters to regulate the management of the Bank’s own risk assets in light of credit risk, while limiting the level of financial involvement with clients, as well as avoiding concentration when allocating resources.

Aimed at ensuring compliance with norms established by Brazil’s Central Bank, in tune with good management practices, Market Risk Management assesses, monitors and controls the exposures of the BNDES to such risk.

Operational Risk Management, in its turn, seeks to identify, assess, treat, and control the operating risks that the BNDES is exposed to, aiming at minimizing losses resulting from failure, deficiency or inappropriateness of internal processes, personnel and systems or external events.

Internal controls are procedures present at all levels of the BNDES that seek: to allow adequate safety to reach the institution’s objectives; to contribute to the accuracy of financial information; and to protect the Bank’s assets, always in accordance with external and internal norms.

The orientation for Risk Management and Internal Controls have been formalized and are available to all employees through the Internal Controls Corporate Policies, Operating Risks Management, Market Risk Management, and Business Continuity Management, approved by the Board of Directors and by the Advisory Board.