Operational Risk Control with Basel II

Basic Principles and Capital Requirements


  • Dimitris Chorafas, Independent Finance Consultant, France

This book:*provides a sound methodology for operational risk control*focuses on management risk and ways to avoid it*explains why and how information technology is a major operational risk*shows how to integrate cost control in the operational risk perspective*details analytical approaches to operational risk control, to help with scorecard developments*explains the distinction between High Frequency Low Risk and Low Frequency High Risk events*provides many case studeies from banking and insurance to demonstrate the attention operational risks deserve
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This book addresses itself to commercial bankers, investment bankers, loans officers, traders, treasurers, backoffice managers, internal and external auditors, consultants, and regulators


Book information

  • Published: October 2003
  • ISBN: 978-0-7506-5909-3

Table of Contents

Operational risk is present in every enterprise- The many types of operational risk; Why management risk, legal risk, and information technology risk are the most important operational risks; Other key operational risks to which senior management and the back office should pay attention; Identification, monitoring, and measurement of operational risk; A case study with operational risk in the insurance industry; Addressing the top-most operational risk- A case study with operational risk in management; Why deficient cost control is the best result of management risk; Legal aspects of operational risk; A case study on operational risks in information technology; Establishing the basis of the scorecard approach- Analytical solutions to operational risk control; Needed experimentation in understanding and gauging operational risk; The scorecard approach suggested by the Basle committee; High frequency low risk and low frequency high risk events; Financial Reserves are not the only means of for facing operational risks- Capital reserves for operational risks; Using insurance as an alternative to operational risk capital requirements;