GARP Risk Index Reaches New Low; Suggests U.S. Economic Recovery

By The Global Association Of Risk Professionals garp, PRNE
Sunday, March 20, 2011

NEW YORK and LONDON, March 21, 2011 - — U.S. systemic risk aggregate drops five points

— Commodity prices are a growing concern among risk managers; now second
highest risk factor

— Quarterly survey of risk management professionals also finds debt
leveraging, banking health, macroeconomic factors among top influences on
economic risk

Risk managers are warily optimistic regarding the American economy,
according to the Risk Index from The Global Association of Risk Professionals
(GARP,, released at GARP's Annual Risk Management Convention in
New York last week. The Risk Index, a quarterly gauge of global perception of
the risk factors affecting the U.S. economy, fell to 108, from 111 the
previous quarter, marking the lowest reading since the Index was first
fielded in the beginning of 2010.

The Index measure of systemic risk in the U.S. economy, or how the
economy suffers major crises, fell five points, from an aggregate score of
115 last quarter to 110 this quarter.

The only risk of growing concern to the American economy, according to
the Index, was commodity prices, whose risk weighted contribution to the
Index increased 3.5 percent during the quarter. Of all commodity prices,
energy commodities are considered the most worrying to the risk managers

"The Index this quarter is our most positive to date, reflecting a sense
of global economic recovery," said Chris Donohue, managing director, GARP
Research Center. "However, risk managers around the world remain on high
alert regarding the commodities market. Their continued concern in this area,
specifically around energy commodity prices, reflects the concern that many
Americans are experiencing with the rise of consumer oil prices."

The Risk Index survey this quarter also attempted to gauge risk managers
expectations for the coming year, and a sense of likely "systemic events."
Risk managers around the world agree that corporate capital for risk
management activities will likely fund risk reporting, data management and
regulatory implementation projects.

Meanwhile, risk managers are most concerned about a non-U.S. national
debt default, crash in the commodities market, and non-U.S. banking crisis as
the next likely "systemic events" that test the global economy.

To complete the current Risk Index report, GARP researchers received
responses from 620 global risk managers between December 22, 2010 and January
7, 2011

About The Global Association of Risk Professionals

The Global Association of Risk Professionals (GARP) is a not-for-profit
global membership organization dedicated to preparing professionals and
organizations to make better informed risk decisions. Membership represents
nearly 150,000 risk management practitioners and researchers from banks,
investment management firms, government agencies, academic institutions, and
corporations from more than 195 countries. GARP administers the Financial
Risk Manager (FRM(R)) and the Energy Risk Professional (ERP(R)) exams;
certifications recognized by risk professionals worldwide. GARP also helps
advance the role of risk management via comprehensive professional education
and training for professionals of all levels.

    Keith Campbell                 Dave Heinzinger
    G.S. Schwartz & Co.            G.S. Schwartz & Co
    +1-202-986-2152                +1-212-725-4500 ext. 327

Keith Campbell, G.S. Schwartz & Co., +1-202-986-2152, kcampbell at or Dave Heinzinger, G.S. Schwartz & Co., +1-212-725-4500 ext. 327, dheinzinger at / NOTE TO EDITORS: To obtain a copy of the Risk Index report and underlying data, please contact Keith Campbell at kcampbell at

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