Othmane Rabi

Ever wondered why two measures—PFE & EEPE—exist in investment banking when they sound so similar? 🤔 One tells you the worst wave you could face 🌊, the other tells you the average swell over time. Both matter, but for very different reasons… 1️⃣ What They Measure PFE – Potential Future Exposure • Definition: The maximum credit exposure a bank might face on a counterparty trade over a specified horizon, at a given confidence level (e.g., 95%, 97.5%, 99%). Purpose: • Used for limit monitoring (counterparty credit limits). • Focuses on extreme but plausible exposure scenarios. Key Characteristic: • Percentile-based — it’s the Xth percentile of the future exposure distribution at each time point. • Ignores average scenarios ⸻———————-————————————— EEPE – Effective Expected Positive Exposure • Definition: The weighted average of Expected Exposure (EE) over the first year of a trade’s life, where each EE is the average positive exposure at a future date. Purpose: • Used for regulatory capital under Basel (especially in Internal Model Method, IMM). • Designed to capture average risk over time rather than just the worst-case percentile. Key Characteristic: • Time-weighted average of means, not percentiles. • Regulatory definition includes discounting short-dated exposures to avoid front-loading capital. ⸻————————————————————— 2️⃣ Why Investment Banks Use Both • PFE is for risk appetite & limit setting — you need to know the “worst case” your counterparty might expose you to so you can set a limit. • EEPE is for regulatory capital — Basel wants an average measure over time to size capital more proportionately to ongoing credit risk, not just the extremes. ⸻————————————————————— 3️⃣ Why the Percentiles Differ This is the key point in your question: • PFE percentile: • Directly picks a high percentile (e.g., 97.5%) from the simulated exposure distribution. • Will always be above the mean unless the distribution is perfectly symmetric and has no volatility. • Sensitive to volatility, optionality, and market shocks. EEPE “percentile” (actually not a percentile): • Based on the mean positive exposure, not a tail statistic. • Even if you simulated exposures at the same time horizon, EEPE is usually lower than the corresponding PFE because it averages out scenarios, not just the tail. • Percentile concept doesn’t directly apply — but if you compared “EEPE vs. the mean of the same timepoint in PFE distribution,” you’d see a gap because of distribution skewness. ⸻————————————————————- Simple Analogy Think of exposure like the height of ocean waves: • PFE = We want to know the height of the biggest waves we might face in the next 5 years at the 97.5% confidence level. • EEPE = We want the average wave height over the year, weighted by time — because that’s what knocks the boat around day-to-day. #PFE #EEPE #CounterpartyCreditRisk #BaselIII #RiskManagement #InvestmentBanking #SACCR #IMM #FinanceInsights#cfbr#creditrisk

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Sanofi Morocco: Rami Mroueh Appointed CEO Sanofi Morocco has announced the appointment of Rami Mroueh as Chief Executive Officer, effective September 1, 2025. A pharmacist by training and graduate of EM Lyon Business School, he joined Sanofi in 2008 and has since held several strategic positions across Europe, including General Manager for Vaccines in the Czech Republic. At 45, he now takes the helm of Sanofi Morocco while also overseeing the group’s operations in Tunisia and Libya, marking a new milestone in the pharmaceutical giant’s regional strategy for the Maghreb. In his expanded role, Mr. Mroueh will be responsible not only for Sanofi Morocco but also for leading Sanofi Pharma activities in Tunisia and Libya, thereby extending his mandate to a broader regional scope. As the head of a leading biopharmaceutical company engaged in scientific research, artificial intelligence, and the development of innovative healthcare solutions, Rami Mroueh will be tasked with steering Sanofi Morocco through a demanding environment requiring innovation, sustainable growth, and deeper regional integration.

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Enko Capital is pleased to announce that it has successfully completed the acquisition of Société Générale Mauritanie, in partnership with Oronte.   This investment reflects our strong belief in Mauritania’s potential and our ambition to contribute to its economic development.   It also marks the beginning of an ambitious strategic project: strengthening the bank’s role in financing key sectors of the economy, and building a solid, inclusive, and innovative institution that operates to the highest international standards.   With the continuity of the management team and the support of our international expertise, Société Générale Mauritania will accelerate the modernization of its service offering, invest in digitalization, and deepen its economic impact.   🚀 A new strategic momentum to support the country’s economic development.   #EnkoCapital #Mauritania #FinancialInclusion 

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Africa’s banking map tells a bigger story than just numbers. Notice the geographical spread of the continent’s largest #banks by revenue — and with it, the balance of financial power. #SouthAfrica, #Nigeria, #Egypt, and #Morocco dominate the landscape. Each is home to multiple banks crossing the $1B annual revenue mark, signaling deep financial ecosystems that extend beyond their borders. These markets act as financial anchors for the continent. But look closer — you’ll notice outliers like Ecobank in #Togo and KCB in #Kenya. They prove that leadership in #African finance isn’t confined to the largest economies. Regional champions can rise from smaller markets and still influence cross-border capital flows. What this map reveals: Concentration: Just a handful of countries dominate Africa’s banking revenues. Regional champions: Banks like Ecobank (Togo) and KCB (Kenya) demonstrate scalability outside the “big four.” Potential gaps: Large swathes of the continent remain unrepresented. That’s less about demand and more about untapped opportunity. The next decade of African #banking won’t just be about the biggest banks getting bigger. It will be about who can capture underserved regions, build digital-first ecosystems, and integrate seamlessly into the #AfCFTA single market. Finance has always been the bloodstream of economies. For #Africa, the map shows where the heart currently beats — but the next pulse might come from entirely new places. Where do you see the next financial powerhouse emerging from in Africa? 🔄️ Repost to your network to educate others.

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