Operational Risk Control with Basel II: Basic Principles and Capital Requirements

Operational Risk Control with Basel II, provides a sound methodology for operational risk control and focuses on management risk and ways to avoid it. The book explains why and how information technology is a major operational risk and shows how to integrate cost control in the operational risk perspective. It aslo details analytical approaches to operational risk control, to help with scorecard developments, explains the distinction between High Frequency Low Risk and Low Frequency High Risk events and provides many case studeies from banking and insurance to demonstrate the attention operational risks deserve.

Assists risk professionals in preparing their institution to comply with the New Capital Adequacy Framework issued by the Basel Committee on Banking Supervision, which becomes mandatory from January 1, 2006Readers benefit from a significantly broader viewpoint on types of operational risks, operational risks controls, and results to be expected from operational risk management - compared to what the reader may gain from books previously published on this same topic

Operational risk is present in every enterprise- The many types of operational risk
Why management risk, legal risk, and information technology risk are the most important operational risks
Other key operational risks to which senior management and the back office should pay attention
Identification, monitoring, and measurement of operational risk
A case study with operational risk in the insurance industry
Addressing the top-most operational risk- A case study with operational risk in management
Why deficient cost control is the best result of management risk
Legal aspects of operational risk
A case study on operational risks in information technology
Establishing the basis of the scorecard approach- Analytical solutions to operational risk control
Needed experimentation in understanding and gauging operational risk
The scorecard approach suggested by the Basle committee
High frequency low risk and low frequency high risk events
Financial Reserves are not the only means of for facing operational risks- Capital reserves for operational risks
Using insurance as an alternative to operational risk capital requirements