ABSTRACT
Risk management is critical to the profitability and survival of investment banking institutions; in this chapter, the various types of risks are briefly explored. Based on its strategic business and operational objectives, an investment bank is exposed to different types of risks such as strategic, market, liquidity, credit, operational, compliance, regulatory and reputational risks. It is essential to establish a robust risk management culture, framework, policies and processes for identifying, assessing, measuring and managing such risks in line with regulatory requirements. In global investment banks, the middle office manages risk and calculates transaction profits and losses. In Nigeria, risk management tends to be bank-wide with a chief risk officer supervising professional risks officer across the investment bank, asset management and securities subsidiaries.
