← Foreign Exchange (Forex) Products and Risk Management

Bank-side risk and the capstone hedging proposal

Module 05 / 5 · 70 min

Control the credit, market and conduct risks the bank takes when it sells FX products, then present a complete hedging proposal for the running case.

In this module you will learn to

Set a counterparty credit limit for forwards using replacement cost and an add-on
Measure the bank's net open position against the SBB/96/2025 limit and cover client deals
Apply suitability checks and AML/CFT controls to FX products
Prepare and defend a client hedging proposal for the capstone

Built on

Erudite Africa course specification: 1.l Foreign Exchange (Forex) Products and Risk Management, Level 2 Intermediate (October 2026)
Erudite Africa: Ethiopian Context programme overview and regulatory register (October 2026)
NBE directives as listed in the lessons: FXD/01/2024, FXD/04/2026, FXD/05/2026, SBB/96/2025
National Bank of Ethiopia Proclamation No. 1359/2025
NBE Monetary Policy Committee meeting No. 7 press release (13 July 2026)
IFRS 9 Financial Instruments (hedge accounting overview)

Examples and companies are fictional. Bank practices are shown as typical Ethiopian practice, not as any one bank's policy. Always apply your own institution's approved policy and the current NBE directives.