The document discusses operational risk management in banks. It defines operational risk as the risk of loss from inadequate or failed internal processes, people, and systems or from external events. It lists the objectives of operational risk management as identification, assessment, monitoring and control/mitigation of this risk. The risk management process involves identifying, assessing, monitoring and controlling/mitigating operational risks like people risk, process risk, and IT risk through methods such as risk assessment surveys, key risk indicators, policies and procedures, internal controls, and risk transfer.

1. Operation Risk Management in Bank Source : Books written by Iyengar & Iyengar Presented by Mr. Baid Nath Singh IMIS, Bhubaneswar

2. Risk management is a systematic way of thinking “The risk management process increases awareness of hazards and risk involved in an operation”

3. Definition of Operational risk “It is the risk of loss resulting from Inadequate or failed internal processes, people and system or from external events” External events Internal Causes People Processes Systems

4. Types of Operational Risks People risk Process risk Governance risk Business operation risk Environmental risk IT risk

5. Operational Risk Management Objectives Benefits Process 1.Identification 2.Assesment 3.Monitoring and control/mitigation of this risk

6. Risk Identification Level 1 lists the main business activities/product/processes Level 2 lists out the sub category Level 3 lists out the product offered Recording of various risk events-experience, judgement, linked events and regulatory requirement.

7. Risk Assessment Risk&control self-Assesment,RCS Self-Assessment process Process mapping Key risk indicators

8. Risk Monitoring Operational risk loss events Self-Assessment survey Key risk indicator limits (KRI) Management information system (MIS) Audit reports

9. Risk control/Mitigation Risk prevention 1.Policies and procedures 2.Internal control system Risk reduction Risk mitigation tools Risk transfer

10. Proper Coordination / Control / Information flow between risk management & risk taking units Data and IT System Training

11. Thank you