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Risk control and measurement

The RCM is a key element in NHFIC’s Risk Management Framework. The RCM lists the risks that NHFIC is expected to face, outlines the controls or risk mitigation in place, assigns relevant risk owners, assesses the likelihood and consequence of each risk before and after mitigation or controls are applied, and will over time assist in identifying early warning signals.

The RCM enables management to form a view of the residual risk and communicate risks to the NHFIC Board and Audit and Risk Committee (through the regular provision of the Risk Dashboard and Risk Assessment Matrix). Management formally reviews the RCM on a semi-annual basis.

Risks are classified depending on their nature-reputation, strategic, credit, funding liquidity and earning, operational, regulatory and compliance, fraud and corruption, culture and people.

Risks are classified depending on their nature. NHFIC’s key risks fall into the following risk categories:

Table 6: Risk categories relevant to NHFIC

Risk category



Risks associated with negative public or political profile and funds usage.


Risks related to meeting strategic objectives and expectations of key stakeholders, business strategy, resourcing and proper corporate structure.


Risk of default from a borrower failing to make their required payments under NHFIC’s loan conditions. Risks of improper credit analysis and portfolio concentration.

Funding, liquidity and earnings

Risks related to our ability to raise and access finance from the capital market, and our ability to settle liabilities or obligations as they become due. Risks related to insufficient earnings to meet operational expenditure.


Risks related to cyber security, loss resulting from inadequate or failed internal processes, people and systems, or from external events.

Regulatory and compliance

Risks associated with breach of the Investment Mandate, NHFIC Act, PGPA Act and rules or other legislation or directions from the Minister relevant to NHFIC and changes in Government policies.

Fraud and corruption

Failure to prevent and detect fraud.

Culture and people

Risks associated with the loss of corporate capacity, knowledge management and inappropriate corporate culture.