The client wanted to have a real-time tracking system of the loan-to-value ratios for its clients, so that it could swiftly ask for extra collateral as a guarantee or take alternative action.

Clients were increasingly requesting that assets such as art works, jewellery, wine, specialised collections and cars be considered as a guarantee for their loans. The markets for some of these possessions were more volatile than others, and, as a result of a study, the bank realised that it could be more exposed to risk than was prudent.

The challenge was to create a system that was easy to use, and allowed for this wide range of asset types to be taken into account.

The solution was to set up a database system. This was unusual, in that it had to track many different types of asset lodged as security against loans. Furthermore, different data was required to calculate values depending on the asset type.

As a result, we had to develop a method which led the user of the system through a series of choices when adding assets so that the appropriate questions were asked about individual assets.

The assets had to be valued constantly with reference to Moody’s and other relevant indices, and the corresponding Loan-to-Value ratios had to be monitored. This included many complex calculations across a wide range of assets.

This resulted in the client being able to manage the business risks more closely.