Salim Batla

Salim Batla, an investment manager turned risk manager is the founder of Implied Risk Calibration Theory. Implied Risk Calibration is a theory that attempts to mathematically explain the correlation between managing financial risks and the incremental risks that arise from such management.

He is a very vocal opponent of the concept of capital adequacy requirements stipulated by Basel Committee on Banking Supervision. His theory maintains that any attempt to reduce the solvency risk by increasing the equity component of balance sheet will invariably result in an equal or greater increase in the financial risk on asset side in a rational market thereby rendering the whole exercise useless and in some cases harmful.

Born in 1969 in Pakistan and later settled in Canada, Batla holds master degrees in economics, business administration and corporate law with a doctorate degree in financial risk management. He started his professional career in Pakistan where he held several senior level position in private as well as public sector. Batla served on the board of directors of major Pakistani companies and later appointed as Adviser to Government of Pakistan on corporate finance and investments during Gen. Pervez Musharraf’s regime. He simultaneously got attached to academic sector in Pakistan and taught in several universities as visiting faculty including National University of Science and Technology, Comsats University, Arid University Business School and Maastricht School of Management in Kuwait.

He founded Econometric Consulting Group, a boutique investment advisory company in 2000 which operates in European and Middle Eastern region. Batla first came to limelight when he wrote a paper on the valuation of combined gulf currency showing that should GCC countries unify their currencies, it would be the doomsday scenario for USA dollar causing an immediate collapse of American economy and trade.

He was later severely criticized on his paper titled ‘A Critical Inquiry on the Mechanics of Islamic Banking” by both the opponents as well as advocators of Islamic banking in 2009. The paper apparently seemed to be too ambivalent to ascertain whether he is speaking against or in favor of Islamic banking.