Operational Risk Management

The management of operational risk, the second most important risk category for the majority of banks as measured by capital requirements, is taking a central role in non-financial risk management.

Key Project Experience

• A complete and informative loss database represents a key element of every bank’s OpRisk management system. Apart from identifying possibilities for structural optimisation, the careful collection and analysis of losses supports an open and positive risk culture. We designed a new data collection process for a small private bank and – using a transparent change management approach – fostered acceptance for the procedural changes and for a change in risk culture.
• Our client, a systemically important German bank, had to redevelop its Pillar II OpRisk quantification model following a supervisory inspection. We designed and implemented a new quantification model, established model validation standards and performed a full initial validation. The resulting model both complied with regulatory standards and captured the specifics of the bank’s business model, allowing OpRisk capital allocation to the bank’s business lines.

C: Illya Payanov
D: +49 (0) 151 11 32 57 73
E: illya.payanov-at-fintegral.com