Stress Testing and Scenario Analysis for Central Banks Training Course

Introduction
As financial systems become more interconnected and vulnerable to global shocks, stress testing and scenario analysis have emerged as critical tools for central banks to assess systemic risk and build institutional resilience. The Stress Testing and Scenario Analysis for Central Banks Training Course is tailored to equip central bankers and financial supervisors with advanced methodologies to evaluate the robustness of financial institutions and the overall economy under adverse conditions. This course focuses on forward-looking risk assessments that inform monetary policy, macroprudential oversight, and crisis preparedness.

Delivered over five intensive days, this course blends theoretical foundations with practical simulations, enabling participants to design, implement, and interpret stress test models aligned with international best practices. Participants will gain insights into macro-financial linkages, sectoral vulnerability analysis, and climate-related scenario planning. The training includes hands-on exposure to quantitative tools and cross-country case studies, fostering a strong analytical and policy-oriented approach to risk assessment in uncertain environments.

Duration: 5 days

Target Audience:

  • Central bank financial stability and research staff
  • Stress testing and risk analytics teams
  • Macroprudential and supervisory policy departments
  • Economists and data analysts in public financial institutions
  • Financial sector regulators and oversight professionals

Course Objectives:

  • Understand the role of stress testing in financial stability and macroprudential policy
  • Design customized stress scenarios for banks, economies, and sectors
  • Apply modeling techniques for both top-down and bottom-up stress testing
  • Evaluate and communicate stress testing results to policymakers and stakeholders
  • Integrate climate, geopolitical, and market shocks into scenario frameworks

Course Modules

  1. Introduction to Stress Testing and Scenario Analysis
  • Purpose and benefits of stress testing in central banking
  • Distinction between microprudential and macroprudential stress tests
  • Historical evolution and key milestones
  • Regulatory requirements and international standards
  • Overview of stress testing frameworks (IMF, BIS, EBA)
  1. Designing Macro-Financial Scenarios
  • Identifying and selecting key risk drivers
  • Macroeconomic models and forecasting tools
  • Scenario construction: baseline vs. adverse
  • Global, regional, and country-specific shock considerations
  • Tools for narrative development and quantitative alignment
  1. Top-Down vs. Bottom-Up Stress Testing Approaches
  • Key differences in data, scope, and application
  • Aggregated modeling of banking system exposures
  • Institutional-level bottom-up scenario execution
  • Pros and cons of each approach
  • Integrating results for comprehensive analysis
  1. Sectoral Stress Testing Methodologies
  • Banking, insurance, and corporate sector stress tests
  • Credit, market, and liquidity risk assessments
  • Contagion and spillover effects
  • Sector-specific data and calibration techniques
  • Using stress testing to detect systemic risk
  1. Climate Risk and ESG Scenario Analysis
  • Climate-related financial risk overview
  • Transition and physical risk scenario modeling
  • ESG integration into financial risk analysis
  • Climate stress testing frameworks (NGFS, ECB, BoE)
  • Central bank roles in sustainability risk oversight
  1. Stress Test Model Development and Validation
  • Statistical and structural modeling techniques
  • Use of Excel, R, Python, and proprietary software
  • Calibration, parameter estimation, and data input challenges
  • Model risk management and validation processes
  • Sensitivity testing and robustness checks
  1. Communicating and Using Stress Test Results
  • Preparing reports for decision-makers and the public
  • Visualization and dashboards for stress outcomes
  • Integrating findings into policy, supervision, and planning
  • Scenario-based contingency planning
  • Lessons from past crises and regulatory stress programs
  1. Case Studies and Practical Exercises
  • Global examples of central bank-led stress tests
  • Simulation of adverse macro-financial events
  • Developing scenarios for your institution or region
  • Peer group exercises on reporting and decision support
  • Designing a full-cycle stress testing plan

CERTIFICATION

  • Upon successful completion of this training, participants will be issued with Macskills Training and Development Institute Certificate

TRAINING VENUE

  • Training will be held at Macskills Training Centre. We also tailor make the training upon request at different locations across the world.

AIRPORT PICK UP AND ACCOMMODATION

  • Airport pick up and accommodation is arranged upon request

TERMS OF PAYMENT

Payment should be made to Macskills Development Institute bank account before the start of the training and receipts sent to info@macskillsdevelopment.com

 

 

Stress Testing And Scenario Analysis For Central Banks Training Course in Mexico
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