Operational risk is devilishly difficult to model, but dealers and software vendors are making headway. Automated op risk reporting, profiling and sophisticated operational value-at-risk (VAR) modelling are finally beginning to catch-on in banks.
Integrated, enterprise-wide, operational risk management can offer much more than just regulatory compliance.
The Basel regulators' proposals for operational risk aren't as risk-sensitive as the committee seems to think, says Tony Blunden. He argues the supervisors should pay more attention to recent developments in corporate governance.
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