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Operational Risk Management: Design, Adoption & Implementation

Curriculum

1. Definition & Drivers of Operational Risk

  • Lifecycle of OpRisk
  • Characteristics & categories
  • Quantitative & qualitative approaches
  • Enterprise risk management & OpRisk drivers

2. The Regulatory Push

  • Pillar structure of the Basel Accord
  • OpRisk capital measurement approaches

3. The Operational Risk Framework

  • Foundation cornerstones
  • Four data building blocks
  • Key outputs

4. Operational Risk Governance

  • Sound governance practices
  • Three lines of defense
  • Governance structures & approaches

Exercise & Case Studies: Design & implement

  • Oprisk management policy
  • Oprisk loss data standard framework

5. Culture & Awareness

  • Integrated components
  • “Use Test” to test embeddedness
  • Effective activities for successful adoption

6. Policies & Procedures

  • Policy best practices
  • Essential elements of OpRisk policy

7. Internal Loss Data

  • OpRisk event data collection
  • Risk event categories
  • Minimum loss data standards

8. External Loss Data

  • External OpRisk event data
  • Benefits & challenges of consortium database

Exercise & Case Studies: Design & implement

  • RCSA & input templates
  • Reporting & support loss database

9. Key Risk Indicators

  • Use of BEICF in capital model
  • Metrics & indicator challenges
  • Risk reporting & monitoring

10. Risk & Control Self Assessment (RCSA)

  • RCSA as BEICF collection tool
  • RCSA methods
  • RCSA Scoring methods

11. Scenario Analysis

  • Methods & approaches
  • Advanced Measurement Approaches guidelines
  • Use of scenario output

12. Capital Modeling

  • Basic Indicator approach (BIA)
  • The Standard Approach (SA)
  • Alternative Standardized Approach (ASA)
  • Advanced Measurement Approach (AMA)
  • Loss Distribution Approach (LDA)
  • Scenario Analysis Approach (SAA)

Exercise & Case Studies: Design & implement

  • KPI inventory template & use
  • Reporting & support dashboard

13. Reporting

  • Risk analysis
  • Loss data reporting
  • KRI & scenario analysis
  • Capital reporting
  • Action tracking reporting
  • Dashboards

14. Risk Appetite

  • Risk capacity vs. risk appetite
  • Acceptance level for risk tolerance
  • Setting thresholds for risk limits & indicators

15. Reputational Risks

  • Inclusion as material risks in internal assessment
  • Use of OpRisk framework in risk management

16. Operational Governance, Risk & Convergence (GRC)

  • Assessment convergence
  • Converged assessment data & tools
  • GRC tools & reporting

Exercise & Case Studies: Design & implement

  • Oprisk management pie chart with inherent & residual risk after mitigation
  • Senior management/board reporting template

17. Best Practices in Related Risk Management Activities

  • New product approval
  • Supplier & third-party risks
  • People, fraud & technology risks management
  • Pandemic planning

18. Implementing Operational Risk Management System

  • Starting point
  • Raising awareness & creating the basis
  • Implementation
  • Adaptation & enhancement
  • Enterprise wide integration

Exercise & Case Studies:

  • Design & implement an RFP for selection of ORM
  • Sample OpRisk capital calculation using BIA, TSA and AMA approaches

 

Last updated on 12 Dec 2017 .