Operational risk
WHAT IS THIS? Operational risks are those arising from people, processes and systems – the biggest form of exposure for many industries, but one that was neglected by financial firms until the collapse of Barings Bank in 1995. It was added to the Basel capital framework in 2004, but attempts to model operational risk were dealt a heavy blow by the huge, unforeseen losses suffered by banks in the aftermath of the financial crisis.
Op risk data: losses decline sharply in first half
Conduct losses account for most of $8.5 billion total. Data by ORX News
Big banks to bear brunt of Basel III reforms in EU
G-Sibs short €82.8 billion of Basel III capital
BoE probes banks on machine learning use
Risk Live: watchdog wants to know “how prevalent” ML models are, say execs
Quantification of operational risk: statistical insights on coherent risk measures
In this paper, the authors review some of the existing methods used to quantify operational risks in the banking and insurance industries.
The operational risk disclosure practices of banks: evidence from India and Romania
This paper compares the levels of operational risk disclosure in the banking industries of India and Romania.
Eurozone G-Sibs’ op RWAs fall €8.1bn in Q1
Deutsche Bank led the charge with €6.4bn reduction
ABA scenario analysis project could aid CCAR comparability
Scheme to agree on common risk drivers could help Fed benchmark risk exposures, says JP op risk expert
Keeping the robots honest
Human overseers are in short supply in an arena where losses can be crippling in minutes
Ex-Huawei tech security chief on steeling UOB’s cyber defences
Singaporean bank overhauls penetration testing and scenario analysis, with Tobias Gondrom leading the effort
Basel set to update op risk and resilience principles
Op risk working group to issue core ‘indicators of resilience’ proposal as update to 2011 principles
Business lines must answer for ML biases – OCC’s Dugan
Banks cannot blame developers or vendors for faulty machine learning models, says regulator
Generali expands scope of internal model
Total SCR drops 8% to €20.4 billion in 2018
Lessons from a decade of top 10 op risks
Constants and changes in Risk.net’s annual rankings spotlight common gaps in op risk management
Financial firms toil to meet new EU rules on outsourcing
Negotiating right to audit vendors, including cloud providers, seen as toughest requirement
Industry should work together on operational resilience – BoE
Regulator to “shortly” issue report highlighting opportunities for op risk collaboration
Op risk data: forex rigging fines bloat bank losses
Citi, RBS, JP hit for total €800m in penalties; plus Aussie bank misconduct probe. Data by ORX News
Allianz’s counterparty risk charge up €102 million in 2018
Total solvency capital requirement down €600 million year-on-year
Singapore banks ramp up cyber scenario analysis
StanChart building out scenario library as dealers up use of technique to gauge spending on defences
Operational resilience means learning from failure
Firms and regulators could share data on mistakes, says Garp’s Jo Paisley
Apac banks call for regulatory push on AML tech
“Regulators have got to stop being okay with how things currently are,” says financial crime head
Axa market risk charge drops almost €3bn in 2018
Solvency capital requirement falls 9% year-on-year
Push harder on cyber intel sharing, Apac regulators told
Regulators must work with banks to foster trust on cyber threat intelligence sharing, say execs