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.
BoE lays out blueprint for RTGS reboot
Central bank plans “comprehensive rebuild” of payments platform
Two-regime approach saves up to 30% op risk capital
Modelling shift to 'crisis mode' mitigates pro-cyclical calculations
The missing piece in operational risk appetite
Setting an op risk appetite is illogical without reference to reward, argues Ariane Chapelle
Comments on the Basel Committee on Banking Supervision proposal for a new standardized approach for operational risk
In this paper, the behavior of the SMA is studied under a variety of hypothetical and realistic conditions, showing that the simplicity of the new approach is very costly.
Should the advanced measurement approach be replaced with the standardized measurement approach for operational risk?
This paper discusses and studies the weaknesses and pitfalls of the SMA and the implicit relationship between the SMA capital model and systemic risk in the banking sector.
AIG hit by $230 million settlement over MedPartners
Megan van Ooyen from SAS rounds up the top five op risk losses for August
Risk managers take note: Brexit was not a black swan
Protecting yourself against true black swans is the art of the possible, not the probable
US Bank’s op risk chief on terrorism and continuity
Jodi Richard explains overhaul of firm’s op risk programme, including crisis management plans
Nationwide's Laing to replace TSB CRO Neeta Atkar
Icap creates global head of regulatory affairs role; NIBC appoints chief risk officer; Crown Agents boosts risk management
Firms aim to convince Basel on merits of op risk insurance
Lack of recognition in new SMA capital charge could cause market to shrink, worry insurers
Risk managers wary of op risk securitisation
Sfr270 million transaction by Credit Suisse and Zurich thought unlikely to be copied due to SMA
Cyber crooks covering their tracks, says UBS intelligence chief
Cyber criminals are increasingly turning into masters of disguise, OpRisk Asia conference hears
The three lines of defence: a health warning
Effective risk management is more important than what your organisational chart looks like
Three lines of defence model comes under attack
Operational risk managers say idea is too formalised and beset by implementation challenges
First SEC whistleblowing chief leaves regulator
Old Mutual appoints new CRO; StanChart hires new head of regulatory reform; Ulster Bank appoints Ireland CRO
FCA’s ‘zero tolerance’ on KYC fosters de-risking – BBA
Media and UK regulator’s approach to financial crime criticised at Commonwealth discussion
State Street sees double whammy of op risk losses
Megan van Ooyen from SAS rounds up the top five op risk losses for July
Operational risk modelled analytically II: classification invariance
In a simple model, Vivien Brunel establishes the properties of an operational risk model under the requirement of classification invariance
OCC’s Cunningham on why regulatory agencies need CROs too
The US banking supervisor has been taking a leaf out of banks’ books and putting the focus on enterprise risk management
Experts question CPMI-Iosco cyber guidance
Speedy settlement and resumption of services after cyber attack could be counterproductive
Technology holds the key to easing KYC, says FCA director
UK regulator promotes the use of financial technology to smooth compliance wrinkles
Regulatory miasma makes life difficult for Ocwen CRO
Op risk veteran Marcelo Cruz says firm faces “absurd” quantity of rules in US mortgage market
$1.5bn subprime hit at HSBC dwarfs other op risk losses
Megan van Ooyen from SAS rounds up the top five op risk losses for June
What Brexit teaches operational risk management
Receptiveness, resilience and reflection are crucial for avoiding nasty surprises