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.
Evaluating operational risk by an inhomogeneous counting process based on Panjer recursion
This paper proposes a new approach for determining OpVaR using an inhomogeneous counting process based on Panjer recursion as the frequency distribution.
Discarding the AMA could become a source of op risk
Basel Committee’s “tantrum-like reaction” is not supported by evidence, say practitioners
Op risk managers must be ‘change agents’, says Fed official
Fed's Gwendolyn Collins calls on op risk managers to be pioneers, not policemen
Dump jargon and engage with business, op risk managers told
Operational risk urged to assume bigger role in strategic and HR decisions
Conference hears fierce criticism of Basel op risk plans
Op risk professionals pour scorn on SMA charge, but some bank experts speak out in favour
Bangladesh central bank governor resigns over theft
Atiur Rahman has resigned following theft of $101 million
Op risk models still needed despite SMA, says regulator
Models “play an important role in quantifying risk”, says OCC's Beth Dugan
Firms seek to improve use of key risk indicators
KRIs are useful tools, say risk managers, but can also be a source of frustration
Top five losses: Julius Baer fined by DoJ, HSBC settles in US
Latest data on op risk losses from SAS (to February 29, 2016)
Basel op risk plans 'not fit for purpose', say banks
SMA expected to raise capital charges, but lower standards in risk management
CCPs face pressure to deal with cyber security threats
Regulators and clearing members urge central counterparties to do more to guard against attacks
Operational Risk Awards 2016 open for entries
Practitioners, vendors and service providers invited to enter to win an Operational Risk Award
Banks grapple with ‘unprecedented’ vendor risk rules
Firms cutting numbers of vendors and hiring more staff to oversee third-party relationships
Banks take various approaches to tackling conduct risk
Definitions, reporting lines, frameworks and metrics vary among major banks, Risk.net research shows
Firms fail to unlock benefits of key risk indicators
Risk culture and data problems have besieged KRI programmes, say authors of new book
Banks collaborate on non-financial risk taxonomy
Operational risk practitioners from large banks working together on industry best practice
Top five losses: JP Morgan settles, internal fraud costs credit union
Latest data on op risk losses from SAS (to January 31, 2016)
All you need to know about op risk in four letters
Processes, people, systems and external events are fundamental to operational risk management, says Ariane Chapelle
CRO says NY Fed faces same op risks as commercial banks
“The predominant risks the bank faces have shifted since the end of the financial crisis,” says Rosenberg
'We are all at risk' from cyber, conference told
Worry of financial firms shown by increasing demand for cyber liability insurance
Operational risk technology product of the year (sell side): NICE Actimize
More than 400 customers are now using the ERCM platform to keep a lid on financial crime
Operational risk technology product of the year (buy side): CloudMargin
Clearing adds complexity for small buy-side firms; CloudMargin aims to take it away
UK banks take lead in tackling conduct risk
Bank actions show how emphasis on culture and conduct has risen globally since 2011
Legacy systems: mission impossible or mission unnecessary?
Old technology poses security and compliance risk