Operational risk What is the operational risk

Operational risk

What is the operational risk • A form of risk that summarizes the risks a company or firm undertakes when it attempts to operate within a given field or industry. Operational risk is the risk that is not inherent in financial, systematic or market-wide risk. It is the risk remaining after determining financing and systematic risk, and includes risks resulting from breakdowns in internal procedures, people and systems.

Administrate of the Operational Risk • Operational risk management system - a complex of organizational, methodological, information tools aimed at the prevention of potential operational risks, minimize negative impacts and prevent repeated incidents of operational risk. • Operational risk management is designed to ensure the reduction of losses from organizations of various kinds of operational risk incidents, provide the company's management system, the formation of the "Action Plan for the Prevention of operational risks" and "action plans, with the occurrence of operational risk incidents"

Classification of operational risks • Personnel Risk - the risk of loss associated with errors and illegal actions of employees of the Bank, their lack of skills, excessive workload, irrational organization of work at the Bank, and so on. D. • Process risk - the risk of loss associated with errors in the processes of operations and calculations on them, taking them into account, reporting, pricing, and so on. D. • Risk systems - the risk of losses caused by imperfections in technologies used in the Bank - lack of capacity systems, their inadequate in relation to the ongoing operations, rudeness and data processing methods, or of poor quality, or the inadequacy of the data used, and so on. D. • Risks of the external environment - the risk of loss arising from changes in the environment in which the Bank is operating - changes in the law, politics, economics, and so on. D. , As well as the risks of external physical interference in the activities of the organization.