●  Macy's, Inc. · FY 2024 

Market Risk

As of February 3, 2024, Macy's determined that there was no material market risk exposure to its consolidated financial position despite managing financing operations through derivative instruments like interest rate swaps and caps. This assessment indicates effective short-term management of underlying risks stemming from borrowing activities and credit card portfolio funding. However, the filing excerpt provided no disclosure regarding critical quantitative measures such as Value-at-Risk or results derived from stress testing scenarios.

M L1 Synthesis
●  SYMBOLOGY.ONLINE l1 SYNTHESIS 

Macy's, Inc Market Risk Synthesis

Quantitative Market Risk Exposure Assessment: Macy's, Inc.

Interest Rate Sensitivity

Magnitude of Exposure and Type

The Company is exposed to interest rate risk stemming from its borrowing activities (Note 6) and the funding activities of its credit card portfolio (Note 2). The primary exposure relates to these financing operations. While all current borrowings are under fixed-rate instruments, the nature of the underlying financial obligations creates potential sensitivity to market movements.

Mitigation Strategies

The Company employs specific derivative instruments to manage this risk. It utilizes interest rate swap and interest rate cap agreements when deemed appropriate to help manage exposures and reduce borrowing costs. Furthermore, the Company manages risks through its regular operating and financing activities.

Assessment (Strengths and Weaknesses)
  • Strength: As of February 3, 2024, the Company determined that there was no material market risk exposure to its consolidated financial position because it lacked market risk sensitive instruments outstanding at that date. This indicates effective short-term risk management.
  • Weakness: The reliance on derivative instruments (swaps and caps) suggests a need for active monitoring of counterparty risk, although the Company confirms it does not use these instruments for trading or speculative purposes.

Foreign Currency Exposure

Disclosure Status

No information regarding foreign currency exposure, involved currencies, translation risk, or transaction risk was disclosed in the provided filing excerpt.

Commodity Price Risk

Disclosure Status

The provided document contains no disclosures regarding commodity price risk, key commodities, contract structures, or impact on margins.

Equity Price Risk

Disclosure Status

No information concerning investment portfolio exposure, mark-to-market impacts from equity prices, or related risks was disclosed in the filing excerpt.

Quantitative Measures and Stress Testing

Disclosure Status

The filing does not disclose any quantitative risk measures such as Value-at-Risk (VaR), sensitivity tables, or results from stress testing scenarios.