GE PowerPoint Template

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Enterprise Risk Management Rob Ceske Chief
Risk Manager, Corporate Treasury General Electric
Company May 17, 2006
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GE Treasurys Mandate
Strong PartnershipWith Businesses
Fixed Rate

• Optimized Funding
• Commercial Paper
• Floating Rate Debt
• Fixed Rate Debt
• Asset Securitization
• Deposits

Ensure Sufficient Capacity Exists to Fund
Growth
Provide Businesses With Tools to Help Compete
Financial Assets
Floating Rate
Solid Risk Management Controllership

• Centralized Cash Management
• Match Funded (Currency, Rate Duration)
• No Speculative Trading Not Profit Center

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Enterprise Risk Management Mandate
Make Optimal decisions
Understand trade offs objectively
Measure what could happen
Reduce/eliminate surprises
Comply with regulations and policies
Understand roles and responsibilities
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Risk Management Ownership at GE
Businesses/CRM
Treasury
Other Credit Risk (Derivatives, Country, S/T
Investments)
Asset Credit Risk
Operational Risk
Economic Capital
Market Risk
Business Strategy
Liquidity Risk
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Treasury Risks and Controls
Controls
Risks

• Strategic

Asset/Liability Management Committee (ALCO)
Policy 6.0 analysis and reporting
Strategic decision-making proper risk
management rating agency relationships
Market
Funding/asset mismatch (gap) FX risk funding
levels/spreads
Match Funding Process Gap and FX exposure
analysis and management processes
Credit
Derivatives/FX counterparty exposure short-term
investments
Derivatives policy no speculation strict credit
limits one-way CSAs on-going monitoring
activities
Liquidity
Disruptions to funding sources/markets
ALCO, Bank back-up lines to prevent disruptions
to continuing funding sources/markets liquidity
stress testing
Operational
Compliance, business continuity, systems,
reputation/press risk
BCP and compliance functions controllership
reviews (error and fraud prevention) STP Six
Sigma dedicated legal and investor relations
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Pragmatic Risk Management

• The only way to eliminate risk is to get out of
  business
• Most risk can be transformed easily eliminating
  it is tougher (and more expensive)
• If you arent measuring it, you probably arent
  managing it
• Risk seems to concentrate in areas that are
  under the radar screen of management
• If you need to choose breadth over depth
• If you dont understand the risks, you shouldnt
  be doing the business