This course looks at the issues surrounding the identification of this type of risk and the subsequent measurement of it.
Description
When people think of banking as a risky business, they are generally concerned with fundamental financial exposures such as credit or interest rate risk. However, the risks faced by banks today stretch well beyond these traditional banking exposures. Technological innovation, growing complexity, and ever-bigger transactions have increased the potential for losses due to non-financial causes. Modern-day institutions must deal with the full gamut of risk, from trade processing errors to rogue traders, technology failures to terrorist attacks. These non-financial types of risk are generally classified under the umbrella term 'operational risk'. The identification, measurement, and management of operational risk is thus a real issue for banks today. But what exactly is operational risk, and how should a bank deal with it? This course along with Operational Risk - Management & Regulation addresses these issues in detail.
Prior to completing this course it is recommended you undertake:
- Risk Measurement & Management
This online course forms part of the Intuition short course suite.
Learning objectives
- Identify the typical sources of operational risk for a financial institution
- Describe the various approaches to assessing or measuring operational risk