Credit risk structural models in op risk

Litigation can cause severe operational risk losses for financial institutions. From 2002 to 2008, litigations dominated banks' external loss profile, according to analysis from the Operational Riskdata Exchange Association (ORX) loss database. The largest of these losses involved initial public offerings (IPOs), mainly from dotcom issuing companies. The ‘loss given litigation' is around 4.8% of the total value of stock issued, based on average litigation settlement per issuing company during th

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