in control report

introduction

The Managing Board is responsible for compliance with relevant legislation and regulation. The Managing Board is also responsible for risk management and control systems that aim to ensure reliable financial reporting and that aim to reduce the risk of non-realisation of NIBC's (operational and financial) objectives. In addition, the Managing Board is responsible for the financing of NIBC Bank N.V. (NIBC).

Financial risk management is the core business of financial institutions. NIBC considers risk management an integral part of providing consistent, high-quality returns to its shareholders. NIBC's risk management framework is focused on identifying, assessing, measuring and controlling risk and on managing risk pro-actively. To this end, the Managing Board has established a sound governance structure around the risk management framework. Within this governance structure, decision-making authority rests with NIBC's Risk Management Committee (RMC). The RMC operates under the supervision of the Managing Board and the Risk Policy Committee, a sub-committee of the Supervisory Board. The RMC has delegated decision-making authority for particular areas of risk management to certain sub-committees, which deal with specific elements of the enterprise risk spectrum.

Ultimately, it is the Managing Board, under the supervision of the Supervisory Board, that is responsible for NIBC's risk management and control systems.

The Managing Board together with the RMC determines NIBC's overall risk appetite and risk profile at a strategic level, evaluates the risk management elements of new business and products, as well as any reputation risks, and approves major changes to risk policies. The RMC and its sub-committees further ensure that assessment and acceptance of credit, market, investment, fiduciary, compliance, liquidity and operational risk exposure is made independently of the business originators within the Strategic Business Units (SBU).

In its role as the party responsible for risk management, the Managing Board is supported by the SBU heads. The SBU heads submit annually separate In Control Reports, which are based upon a semi-annual Control Risk Self Assessment of the activities within their SBUs. Through membership of the different risk management committees, members of the Managing Board have the ability to effectively and efficiently adapt NIBC's risk management policy and risk management framework, so that it remains responsive to the changes in the financial marketplace.

Risk is inherent to almost every business decision and business activity. To that end, NIBC's risk management and control systems can never give an absolute guarantee that all risks are adequately managed or that the company's objectives will be realised.