FRMS

FRM stands for Financial Risk Manager, a professional designation awarded by the Global Association of Risk Professionals (GARP). The FRM credential signifies expertise in identifying, assessing, and mitigating financial risk across markets, credit, operations, and liquidity. It is widely used in banks, asset managers, consulting firms, and corporate risk functions.

History and scope: The FRM designation was introduced by GARP in 1997 to standardize risk-management knowledge. It covers quantitative methods, risk models, regulatory frameworks, and practical risk governance, with an emphasis on applying theory to real-world risk decisions.

Examination: The FRM program consists of two parts. Part I tests foundational knowledge in risk management, quantitative analysis, financial markets, and products; Part II focuses on applying risk measurement and management to market risk, credit risk, operational risk, liquidity risk, risk models, and current issues. Candidates must pass both parts to proceed.

Eligibility and certification: After passing Part I and Part II, candidates must demonstrate a minimum period of professional work experience in a risk-related field (commonly two years) to be awarded the FRM designation. The work experience must be verified by GARP.

Maintenance and recognition: FRMs participate in GARP's Continuing Professional Development (CMP) program to maintain the credential, typically completing at least 40 hours of CPD over a two-year cycle. The designation is internationally recognized and can support roles such as risk analyst, risk manager, or chief risk officer across financial services and related industries.