Over the past two years most of the accepted assumptions on which financial risk was calculated have been swept away.

We have identified several key issues central to understanding financial risk, namely:

• How to tackle the systemic risks to the system and avoid further crises?
• How to restore both public trust and balance sheets?
• How to recalibrate risk and reward?
• How to regulate both fairly and adaptively?

In an exercise with one financial organisation, global economic meltdown and loss of faith in the banking system were identified as two wildcards that might materially change the paradigm.

Are these the financial risks of tomorrow, or is it business as usual with some regulatory adjustments? How to assess, communicate and manage financial risk and its opportunities?

Perhaps it is time to consider plausibility alongside probability, and determine suitable strategies to deal with potentially disruptive change. Scenarios Architecture offers the tools to start such a strategic conversation on what the financial risks might be and how best to respond to them.