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.
Banks grapple with social media risk
In shadow of Metro Bank WhatsApp episode, panellists warn banks need to deftly handle social media blow-ups
FCA may delay enforcement of UK’s conduct regime
Smaller firms won’t be penalised right away, says head of regulatory decisions committee
It’s a dangerous world: stress-test your managers
Ex-British Army chief tells banks: “You need to see how your peers react when the pressure is on”
Royal Commission refunds weigh on Aussie banks
A$1.7 billion of remediation costs taken by Big Four in H1
Want to catch misbehaviour? Watch the electronic chat
“It’s amazing how many people have arguments on chat” – BNP surveillance executive
BoE to scrutinise banks’ op risk tolerance limits
Watchdog says banks must prove they can stick to tolerance limits; cyber stress test planned
HSBC hires BoE’s cyber risk chief
Watchdog’s CISO will serve as UK bank’s first head of resilience risk
As legal losses recede, Morgan Stanley's op risk falls
Bank cuts op RWAs 7% in the first quarter
Op risk data: Chinese regulators levy record fines
Also: top losses feature two frauds at Russia banks and AML provisions at Nordea. Data by ORX News
Quants propose new method of calculating op risk VAR
So-called ‘incremental value-at-risk’ offers future snapshot of op risk exposure, authors say
A Chinese megabank and its CRO in the US
Frank Morisano has put together a risk team, his unit funds itself, and he’s banned cloud technology
Higher op risk charge follows UBS tax fraud verdict
Clash with French courts adds $2.8 billion to op RWAs
Life’s a breach: banks settle uncomfortably into GDPR
A year into exacting data privacy regulation, ramifications are becoming more tangible
Stoplight system could spot imminent meltdowns – study
Proposed traffic light system sifts through transaction data for signs of trouble
Modelling cyber losses could get easier – study
Cyber losses behaved much like non-cyber losses when grouped by severity, so perhaps less data is needed
Smart weaponry aids bank fight against money laundering
Advanced algos and machine learning gain credence as regulators encourage innovation
EU G-Sibs add €2.7bn of op RWAs in 2018
Op risk charge anticipated to jump €21.5 billion under Basel III
Op risk data: Europe’s AML drive follows Danske and ING slips
Also: top five losses include mortgage penalty for Citi and reporting fines for Goldman, UBS. Data by ORX News
The future of operational risk management
As the efficiency of operational risk management remains a top priority and pressure to maximise value increases, emerging technology could prove crucial. Nitish Idnani, leader of oprisk management services at Deloitte, explores how the oprisk management…
Fed preps draft white paper on cyber risk
US regulator seeks industry input for initiative on classifying and modelling threats
Op risk past is prologue for UK banks
UK banks will not be allowed to forget past misdeeds
Lower credit risk shrinks UK banks’ RWAs
Figures from the Bank of England show total RWAs for the UK banking sector amounted to £2.83 trillion at end-December
UBS hires Finma banks chief amid risk reorg
Schoch move comes after bank carves op risk and compliance unit out of central risk function
At EU banks, bad business practices led op risk losses
Misconduct trumped external fraud and process management failures