The majority of Australian superannuation funds are holding operational risk reserves to protect against potentially fatal operational risk shocks.
Op risk loss reserves are being held by 21 of the 28 industry, corporate and public sector retirement funds surveyed by Mercer, a financial consultancy, in Australia.
Furthermore, seven of the pension funds said they had drawn on their op risk reserves during 2009.
"It is commonly for pricing errors," says David Knox, the senior partner at Mercer res
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