Associate Director, MRM Validation Lead

Some careers have more impact than others.

If you’re looking for a career where you can make a real impression, join HSBC and discover how valued you’ll be.HSBC is one of the largest banking and financial services organisations in the world, with operations in 62 countries and territories. We aim to be where the growth is, enabling businesses to thrive and economies to prosper, and, ultimately, helping people to fulfil their hopes and realise their ambitions.We are currently seeking an experienced professional to join our team in the role of Associate Director, MRM Validation Lead.

 Model Risk Management

• Model Risk Management (MRM) at HSBC is structured as a global function, headed up by the Chief Model Risk Officer (CMRO). The MRM function reports directly to the Group Chief Risk and Compliance Officer (GCRCO) ensuring its independence from the model developing and owning areas of the firm. MRM are the second line of defence (2LoD) for Model Risk and the CMRO is the global Model Risk Steward for the group and is also accountable for the global operation of the MRM function. MRM teams are based in each region, to ensure local subject matter expertise and to guide, review, and challenge. MRM activity is managed on a global basis as many models are used in multiple locations. This enables MRM to operate consistently and efficiently globally, and to take account of additional local regulatory requirements.
• Model Risk Governance - Setting the firm's model risk policies and standards, ensuring that model risk is managed within the approved tolerance levels, providing second line assurance on the implementation of policy, and monitoring regulatory developments impacting model risk.
• Model Risk Stewardship - Facilitating responsible development, understanding and use of models and analytics, as well as providing subject matter expertise, advice, guidance, and effective challenge across all entities, regions, global businesses, and functions.
• Independent Model Validation- Independently reviewing and (re)validating models, providing an objective, unbiased and critical opinion on the suitability and soundness of models for their intended use and the accuracy, relevance and completeness of outputs used to inform business decisions.
• Independent Model Validation is a specialist quantitative role within the Model Risk Management team responsible for carrying out independent validations of HSBC’s model landscape, in order to identify and communicate model limitations and issues. Independent Model Validation provides independent challenge of a model’s underlying theoretical assumptions and limitations, its practical implementation, its live application and business usage, providing stakeholders (including model users, senior management, audit and regulators) with assurance that models and tools developed, maintained and used within HSBC Group are fit for their intended purposes and are compliant with applicable internal and supervisory expectations. They will also review remediation plans and activities, undertake portfolio level reviews across model types and challenge the model owners on the appropriate application of relevant policy of models.
• Model types include but are not limited to Credit Risk models (Retail and Wholesale)- IRB/IFRS9 models, Stress Testing and Scenario Analysis models, Economic Capital models, Financial Vulnerability models, Pricing models, Traded Risk models, Insurance Risk models and models covering non-financial areas e.g., transaction monitoring, customer selection and human resources. This includes the traditional model types as well as modern approaches such as machine learning (ML) and artificial intelligence (AI) techniques.
• This job description is for Market Risk model validation.

In this role, you will:

• Undertake measures to independently execute end-to-end model validations as dictated by the Global Model Risk Policy including the assessment of model inputs, calculations, reporting outputs, conceptual soundness of the underlying theory and the suitability of the use for its intended purpose, relevance and completeness of data, qualitative information and judgements, documentation, and implementation of the model.
• Design, develop, and execute testing frameworks, tailored to specific model complexities to identify risks and limitations. Develop and implement advanced validation methodologies and tools to enhance the efficiency and effectiveness of the validation process.
• Responsible for ensuring the execution of model validation projects within their functional stream, ensuring timely delivery and quality of work. Contribute to the continuous improvement of validation processes and methodologies, suggesting enhancements and opportunities to streamline processes.
• Lead discussions and negotiate with model developers and business owners regarding validation outcomes including identified issues and limitations, remediation actions, and when required defending validation conclusions effectively.
• Guide the interaction with Group Internal Audit on model related audits, MSIIs and audit issues.
• Proactively participate in strategic initiatives for MRM, being a champion of changes and proactively making suggestions for improvements. Collaborate closely with senior managers in Global Businesses and Functions in order to plan, prioritise and deliver model risk management activities that are aligned with business strategic goals and priorities, whilst ensuring strong second line independence and oversight is maintained.
• Guide the Global Model Risk Steward by ensuring that potential model risk issues, impacts to risk appetite, internal and external audit findings and regulatory issues are managed appropriately and escalated in a timely manner as required.Guide the preparation and delivery of model risk management opinions and papers for inclusion in first and second line senior governance forums, including Country/Regional-level Executive Management and Board committees.
• Take measures in providing model users, senior management, audit & regulators (across 1LOD, 2LOD, 3LOD) with confidence that the models and tools developed, maintained and used within the Group are compliant with internal and regulatory expectations and fit for the intended purpose.
• Approve decisions/reports/remediation activity as required within the model lifecycle as the Global Model Risk Steward delegate (as required).
• Responsible for ensuring enterprise-wide risk model review policies and standards are communicated, understood and embedded by stakeholders.Participate in engagements with Regulators as required to evidence robust independent challenge of models used in HSBC.Contribute to management, regulatory, and external confidence in all models used across the group.
• As a Model Risk Lead, Provide functional leadership for a team of Model Risk Management colleagues operating across geographies and the HSBC matrix.Provide support, guidance and coaching to members of the Model Risk Management team across the bank. Ensure the effective implementation of Model Risk Management processes, techniques and other associated methodologies within the functional area.Completion of portfolio level reviews to ensure consistency of application of the model risk policy.

To be successful you will:

• Bachelor’s or master’s degree in a quantitative field such as Mathematics, Statistics, Physics, Engineering, Finance, or a related discipline.
• Domain: Traded Risk/ Pricing Risk/ Counterparty Risk: Market risk VaR, FRTB, Value at risk models using Greek based or Full Revaluation, PFE modelling for XVA, Cross value adjustment (XVA) modelling Incremental Risk charge (IRC) models, Pricing- Derivatives/ Product Control and hedging models across asset class like Interest rate, FX, Equity.
• Technical: Stochastic calculus, Numerical methods, Probability theory, Regression, Time series analysis, Numerical Methods (Lattice Based - Binomial or Trinomial), Simulation based (MC) and Analytical based (PDE), Black Scholes, Binomial and Trinomial, Hull white
• Strong understanding of regulatory requirements regarding model development and validation (e.g. PRA, OCC/FRB, EBA, HKMA, UAE). Excellent knowledge of Risk models, performance metrics and risks and associated issues.Strong knowledge of internal procedures would be an advantage.
• Proven ability to manage and motivate a small team will be preferable.Extensive experience in leading and supervising model validation.
• Excellent skills in advanced programming languages (e.g., Python, SAS, C++, Java) and specialised statistical software.Deep understanding of financial products, markets, and relevant quantitative modelling techniques for the specific domain.
• Support the management of model risk across a large complex banking group.Support and manage multiple senior stakeholder relationships across the HSBC matrix.
• Manage model risk whilst significant transformational activity is being implemented.Operate and influence within a changing and rapidly developing regulatory environment.
• Continually support HSBC's approach to conduct and cultivate a positive risk aware culture, which is designed to ensure we deliver fair outcomes for our customers and do not disrupt the orderly and transparent operation of financial markets.
• Adopt the risk management and internal control structure, referred to as the Three Lines of Defence. All staff must familiarise themselves and adhere at all times with the role and supporting responsibilities they play in the Three Lines of Defence.

You’ll achieve more at HSBC

HSBC is an equal opportunity employer committed to building a culture where all employees are valued, respected and opinions count. We take pride in providing a workplace that fosters continuous professional development, flexible working and, opportunities to grow within an inclusive and diverse environment. We encourage applications from all suitably qualified persons irrespective of, but not limited to, their gender or genetic information, sexual orientation, ethnicity, religion, social status, medical care leave requirements, political affiliation, people with disabilities, color, national origin, veteran status, etc., We consider all applications based on merit and suitability to the role.”

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