A Company must implement a forward-looking Stress Testing programme as part of its comprehensive approach to Risk Management. Extreme, but plausible, adverse scenarios for a range of material risks must be included in the Stress-Testing programme, commensurate with the size of the Company's risk exposures. The results of the Stress Testing programme must be reflected on an ongoing basis in the Company's risk management, in order to help the Company in maintaining an awareness of the impact of the stresses on its financial position, including contingency planning and the Company's internal assessment of its capital and liquidity.
2.
A Company's internal process for assessing capital and liquidity requirements must take into account the nature and level of risks taken by the Company. In addition to the specific risks identified by the Central Bank in the Financial Regulations, a Company must consider all other material risks.