Overriding goals and organisation of our risk management

The overriding goal of our risk management is to adhere to our strategically defined risk positions and to ensure that sufficient capital resources are available at all times. We attach central importance to the following elements of our risk management system:

• Management and monitoring of individual risks so that the total risk remains within the permissible tolerances
• Separation of functions between divisions that enter into and manage risks, on the one hand, and those that monitor risks (Group Risk Management), on the other
• Process-independent monitoring by Internal Auditing
• Regular review of the efficiency of systems and, as appropriate, adjustment to the business environment and/or the changed risk situation within the scope of our internal risk management and control system
• Systematic and comprehensive monitoring of all conceivable risks from the current perspective that could jeopardise the company's profitability or continued existence with the aid of efficient and practice-oriented management and control systems
• Reporting to the Risk Committee and the Executive Board that is counterparty-oriented and encompasses all the various types of risk
• Ad hoc reports as necessary
• Documentation of the vital elements of the system in mandatory instructions
• Good financial strength and risk management ratings from the rating agencies of greatest relevance to our company

In the year under review our risk management was assessed by Standard & Poor's as “Strong”, the second-best S&P rating. This evaluation testifies to the quality of our holistic approach to risk management. The current financial strength rating from Standard & Poor's is “AA-” (“Very strong”, negative outlook), while that of A.M. Best is “A” (“Excellent”, stable outlook).