Nicolás Olea KPMG

Nicolás Olea Zazueta is the Partner in charge of Financial Risk Management, a Risk Consulting unit within the Advisory Practice at KPMG Cárdenas Dosal, SC., the Mexican member Firm of KPMG International, a nearly 130,000 Global network of professionals in 157 countries, providing Assurance, Tax & Legal and Advisory Services to a wide diversity of Industries. He leads one of the most complete Risk Consulting services boutiques, with a team of nearly 100 professionals located in Mexico City and Monterrey, along with other four Partners specializing in a wide diversity of services targeted mostly to the Financial Services Industry in Mexico and the Latin American Region. Nicolás earned an Accountancy degree and a Master in Science degree in Information Systems, both from the Instituto Tecnológico y de Estudios Superiores de Monterrey (ITESM or Monterrey Tech-Monterrey Campus) and did joined KPMG on September 1999 after having worked on Corporate Financial Planning developing computer-based financial models and simulations at CEMEX Headquarters in Monterrey Mexico during the 80´s, then held asset-based financing positions at Banco Español de Crédito (Banesto, now part of Santander) and afterwards worked in Chicago at REFCO, the US third largest Derivatives Clearing & Settlement Company during the 90´s, then came back to Mexico at the BMV (Stock Exchange) to pioneer the launching of MexDer, the Mexican Derivatives Market, the first self-regulated market in Mexico. During the last 15 years at KPMG, Nicolás has been involved in a wide diversity of audit, regulatory and advisory engagements, targeted at the Financial Services Industry. He specialices in Financial Instruments –including derivatives- accounting under the different accounting standards worldwide: IFRS & US GAAP. He has conducted extensive training within KPMG Latin America Firms network on Derivatives, Exposure & Risk Management and has been trained by KPMG on IFRS´s Financial Instruments Topics as a Trainer, since year 2000. He is a member of the Mexico City Public Accounting Chapter since 1999, also a member of the Financial Instruments Committee of the CINIF (Mexican Board of Accounting Compliance) since 2005 and before that, on the Accounting Principles Commission. A former member and President of, MexDer’s Audit Committee and an ex-member of the Editorial Board of Contaduría Pública, the official magazine of the Institute of Public Accountants with 22,000 subscribers, he has published on Contaduría Pública and on the Institute of Mexican Financial Executives (IMEF) magazine on accounting and financial topics and has been cited by the Wall Street Journal.

ANTONIO VILLARREAL KPMG

Antonio Villarreal Vivé, is a Financial Risk Management Partner, within the Risk Consulting unit of the Advisory Practice at KPMG Cárdenas Dosal, SC., the Mexican member Firm of KPMG International. Antonio specializes in Credit and Operational Risk Management. After earning an Actuarial degree and a Diploma in Econometrics from ITAM in the 90’s, Antonio worked at Bancomer Credit Card unit, performing a diversity of portfolio analytics, then went to University of Barcelona to earn a Masters and a Phd degrees on Applied Economics and joined KPMG México for two years in 2001, afterwards an opportunity to launch Banco Azteca’s Risk Management unit did arise and he went to work at this newly formed Bank for eight years, developing the required model analytics, including Credit Risk models targeted at obtaining CNBV’s certification on the Bank’s IRB model.- While at Azteca, he did also stood as Head of Risk Management for Afore Azteca and after leaving Banco Azteca, he went to ING as Head of Risk Management until 2012 when he decides to move to KPMG after SURA did bought ING Mexico. Antonio brought more than 15 years of experience in Model Analytics, Comprehensive Risk Management -including Operational Risk-, Risk Governance and CNBV´s Impairment Criteria on Loan portfolios, as well as experience on the regulatory path toward achieving Internal Credit Models Certification. During the last two years at KPMG, Antonio has specialized in Model Building and Model Validation under KPMG Methodological approach, as well as acquaintance on the Accounting topics related to Credit Portfolios, such as Amortized Cost Calculations & Impairment Testing under both IFRS and US GAAP. He has also participated at KPMG’s Advisory University training sessions in the US and specialized training in Europe on Impairment under IFRS 9. He does also participate in KPMG’s IFRS 9 workgroup on Impairment testing assurance and tools.

Objetives: Permeate the participants on the implications of IFRS 9, from a perspective that includes the Risk Manager and the maker of financial information. Learn about this new accounting standards applicable to financial instruments, including the three sections already approved: Classification & Measurement, Impairment and hedge accounting. Understand what a business model is for the purposes of this standard, as well as the implications of a radical change of “incurred loss “to” expected loss, as the basis for impairment. Realign accounting with the risk management that is carried out in reality. Addressing tools used in the efforts of transition to this new standard and that will be applied from 2018. Addressing the aspects associated with this accounting standard.

Program: An Overview of IFRS (International Financial Reporting Standard) # 9 and why it time to replace IAS 39. The three sections of IFRS 9:

1. Classification and Measurement of Financial Assets and Liabilities. a) The categories of current assets and liabilities (IAS 39) V.S. new introduced by IFRS 9. b) Fair Value Through P&L (FVTPL) is now the Default Category. c) Fair Value Through Other Comprehensive Income (FVTOCI). d) Amortized Cost. e) Testing business model and the tests associated with the Contract Flows (SPPI Testing). f) No separation of Embedded Derivatives for financial assets, but feasible for financial liabilities. g) Inter-categories Reclassifications. h) DVA in financial liabilities and the need to recognize these effects in other comprehensive income (OCI). i) Nexus between IFRS 9 and IFRS 13 (Fair Value Measurement) and Fair Value hierarchy (Levels I, II & III), based on the level of observability of inputs. j) Tools to address section C & M: iRADAR and Loan Analyzer.

2. Impairment of financial assets (Impairment). a) Expected Loss approach following IFRS 9. b) The three stages (or buckets): - - Step 1: Theory and practice of expected loss to 12 months. - - Step 2: Reviewing detail of “lifetime expected losses.” - - Step 3: Non performing loans. c) Accounting for Stage 1, 2 and 3, How does the basis of accrual of interest change? d) Featured Topics: Evaluation of collective losses vs. individual. e) Reasonable value and deterioration. f) G-CLAS (Global Credit Loss Accounting Solution) a tool to address the challenge of IFRS 9.

3. Hedge Accounting. a) Eligible to be covered items and hedging instruments. b) The DNA of IAS 39 remains, but there are changes regarding: evidence of effectiveness, thresholds for effectiveness, Risk drilling, documentation and more. c) Hedge accounting relationships. d) Hedges added exhibitions. e) No allowance to de-designate hedging relationships. f) Hedging with options and how volatility is minimized changes in the extrinsic value entailed under IAS39. g) Transaction-based vs. Time-based hedging with options.

SESSIONS Wednesday June 20 | 10:00 am - 6:00 pm Thursday June 21 | 10:00 am - 5:00 pm DURATION: 15 Hours VENUE: Universidad Panamericana Campus Santa Fe Antonio Dovalí Jaime 75, piso 6, Centro de Ciudad Santa Fe

REGISTRATION Telephone:: +52 (55) 5638 0367 y +52 (55) 5669 4729 E-MAIL: [email protected] COST: $25,000 MEXICAN PESOS + TAX (16%) LIMITED OPENINGS

REQUIREMENTS: 1. Graduated from an economic and/or administrative career. 2. Preferably working in Financial Institutions. 3. Participants should bring a laptop.

PAYMENT METHODS: Bank Transfer in US Dollars (Foreign Institutions) BANK: BBVA Bancomer BRANCH NUMBER: 095 SWIFT: BCMRMXMM BENEFICIARY: RiskMathics, S.C. ACCOUNT NUMBER: 0121 8000 11 0583 0066 Credit Card: VISA, MASTERCARD or AMERICAN EXPRESS.

IMPORTANT NOTICE: There will be no reimbursements

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