News/Operational risk
Malaysian central bank called to act against 1MDB officials
Bank Negara Malaysia says it will continue to work with international agencies over alleged fraud
Fed official: banks must recover from cyber attack in two hours
“If you’re waiting for us to give you regulation, you’re behind the curve,” says Fed’s Ferlazzo
CCAR helps identify op risks, banking experts say
Banks forced to consider link between risks and macroeconomic factors
Revised SMA could allow banks to ignore past op risk losses
Leaked proposals say loss component will be left to national regulators, threatening an unlevel playing field
Three lines of defence model still evolving, say practitioners
Clearer split in responsibilities between first and second lines needed, say op risk chiefs
Cyber insurance not a risk management tool, say banks
Lengthy payout mechanism of cyber policies makes it ineffectual against large losses, dealers argue
Cluster model relies on op risk ‘storms’
Capital models should reflect loss grouping – research
Regulators told to play greater role in cyber security
Companies can’t battle threats on their own, CFTC told
Ice rule change will see members post more cash
Changes pinned on CCP’s lack of access to Fed deposit account
Scrap ‘absurd’ op risk RWA framework, says Sands
Ex-StanChart chief exec advocates replacing current op risk capital framework with regulator-set buffer
Buy side may have to take on CCP losses – FSB’s König
Exempting ailing banks from CCP wind-up process could force wider allocation of losses
New Basel delay throws SMA into doubt
Revised op risk capital framework unlikely to be implemented uniformly, even when a deal is agreed, bankers say
Banks voice fresh concerns over CCP non-default losses
Dealers could face cash calls to recapitalise an ailing CCP that suffers a critical non-default loss under FSB proposals
Fed economist advocates combining internal models with SMA
SMA could act as a floor for calculating op risk RWAs, suggests Filippo Curti
Op risk family tree challenges Basel’s business line focus
Cladistic analysis shows importance of control failure, crime and fraud
Deutsche Bank faces op risk capital hit from DoJ fine
Bump to operational risk capital under SMA could be bigger than expected, experts warn
Energy risk teams explore use of KRI metrics
KRIs show particular promise for managing operational risk
KYC rules force banks into costly off-boarding exercise
Shedding unprofitable clients drains operational and IT resources
Basel’s Adachi: banks may discard some loss data under SMA
Losses from discontinued businesses may not count towards op risk capital
IFRS 9 loss rules distracting banks from models and data
Banks neglecting necessary work on data and model governance, warn tech vendors
European banks face steep op risk capital hike from SMA
Op risk accounts for 28% of US banks’ RWAs, compared with 12% at European banks