Operational Risk

According to Basel II, Operational Risk encompasses "the risk of losses resulting from inadequate or failed internal processes, people, systems, or from external events." Unlike other risk types, Operational Risk relates to operational vulnerabilities that can directly threaten business continuity.

🔍 Differentiation from other risk types:

📊 Typical event categories:

⚙ ️ Special characteristics:

A robust Operational Risk Management Framework (ORMF) integrates several key components for a comprehensive approach to managing operational risks:

🏗 ️ Basic structure:

🔄 Core processes:

💻 Technological support:

Regulatory requirements for Operational Risk Management have increased significantly in recent years:

🏦 Basel framework for banks:

🏢 Solvency II for insurance:

🌐 Digital Operational Resilience Act (DORA):

📋 Cross-industry standards:

The Three-Lines-of-Defense model defines clear responsibilities and controls at three levels:

🛡 ️ First Line of Defense: Operational business units

🛡 ️ Second Line of Defense: Risk management and compliance

🛡 ️ Third Line of Defense: Internal audit

Risk Control Self-Assessment (RCSA) is a central methodology in Operational Risk Management where functional departments systematically assess their own risks and controls:

📋 Definition and purpose:

🔄 RCSA process:

🛠 ️ Implementation steps:

📊 Success factors:

Key Risk Indicators (KRIs) are early warning indicators that signal potential risks before they lead to losses:

🎯 Definition and purpose:

🔍 Characteristics of effective KRIs:

🔄 Development process:

📊 Categories of KRIs:

🖥 ️ Monitoring and reporting:

The integration of AI and Predictive Analytics opens new possibilities in Operational Risk Management:

🧠 Application areas:

🔍 Specific technologies:

🛠 ️ Implementation steps:

⚠ ️ Challenges:

The New Standardised Approach (NSA) is the new standard method for calculating capital requirements for operational risks under Basel III/IV:

📊 Basic principles:

🧮 Calculation methodology:

1 increase capital requirement, values <

1 reduce it

📋 Requirements for loss data collection:

10 years of historical loss data

000 EUR

🔄 Implementation steps:

Business Continuity Management (BCM) is an integral part of Operational Risk Management:

🎯 Objectives and benefits:

🔄 BCM lifecycle:

🏗 ️ Organizational embedding:

💻 Technological support:

Cyber risks require a specialized approach within the ORM framework due to their complexity and dynamics:

🔍 Special characteristics of cyber risks:

🏗 ️ Integration into ORM framework:

🔄 Cyber risk management process:

🛡 ️ Specific measures under DORA:

A strong risk culture is the foundation of successful Operational Risk Management:

🌱 Definition and significance:

🏗 ️ Core elements:

🔄 Development and implementation:

📊 Measuring risk culture:

Loss Data Collection (LDC) is a central element in Operational Risk Management:

📊 Definition and purpose:

🔄 Core elements of an LDC process:

000 EUR)

🛠 ️ Implementation steps:

📈 Use of loss data:

Scenario analyses are an important tool for assessing rare but severe operational risks:

🎯 Definition and purpose:

🔄 Scenario analysis process:

📊 Typical scenario categories:

🛠 ️ Methodological approaches:

Integration of Operational Risk Management into corporate governance is crucial for its effectiveness:

🔄 Strategic integration:

📊 Operational integration:

💼 Management reporting:

🛠 ️ Implementation approaches:

Outsourcing and Third-Party Risk Management are critical aspects of Operational Risk Management:

🔍 Risks related to third parties:

🏗 ️ Framework for Third-Party Risk Management:

📋 Regulatory requirements:

🛠 ️ Best practices:

Measuring and evaluating the effectiveness of Operational Risk Management is crucial for continuous improvement:

📊 Quantitative metrics:

🔍 Qualitative assessments:

🎯 Balanced scorecard for ORM:

🔄 Continuous improvement process:

Implementation of effective Operational Risk Management involves various challenges:

🏢 Organizational challenges:

🔄 Methodological challenges:

💻 Technological challenges:

📋 Regulatory challenges:

Operational Risk Management varies by industry in focus, methodology, and regulatory requirements:

🏦 Financial services sector:

🏭 Manufacturing and industrial sector:

🏥 Healthcare:

💻 Technology and IT sector:

🔄 Cross-industry best practices:

Operational Risk Management plays a crucial role in digital transformation:

🔄 Dual role of ORM:

🚀 New risks from digital transformation:

🛠 ️ Adaptation of ORM approach:

💡 Opportunities for risk management:

Operational Risk Management will evolve through various trends in the coming years:

🔮 Technological developments:

📋 Regulatory developments:

🔄 Methodological developments: