Queensland Investment Corporation (QIC) aims to strengthen and fully integrate its risk management capabilities by implementing a software platform enabling coverage of all asset classes and investment instruments.

The manager has become the first Australian client of the VALUE software provided by Sophis, a derivatives technology specialist that has its roots in providing risk and portfolio management systems to investment banks.

Troy Rieck, managing director of QIC Capital Markets, said the manager wanted to “nail down a best-practice, automated portfolio and risk management system” that could be applied across all asset classes and comfortably handle derivatives, given the increase in the variety and volume of the instruments in recent years.

The system, which will be integrated with existing in-house and purchased risk management software, simplified technical back-office and risk processes, allowing staff to “focus on the real work and think about controlling risk,” Rieck said.   

This involved liquidity and counterparty risk stress-testing across entire portfolios, not only specific asset classes.

“We have models for stress-testing, scenario analysis, capital allocation, exposure management – our desire is to squash down the operational risks that funds face so they can focus on investment policy,” Rieck said.

The manager also aimed to provide sharper and more timely risk management information to institutional clients to help them meet the pressures of regulatory oversight, such as proof of available liquidity and the integrity of investment data.

“Operational efficiency, systems integration, robustness in the face of change – if you get your systems right it helps to deal with the factor X that comes along from time to time.”   

Sophis sees the implementation at QIC as a “key base” from which its business strategy in Australia will be launched, Pascal Xatart, chief executive of the software vendor, said in a statement.


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