Critical evaluation of operational risk tools used in regulatory capital calculations

Description

Bank failures during recent years continue to cause stakeholders to question how board and senior management are overseeing and managing Operational Risk. This research evaluated the use of Operational Risk tools by South African banks who have adopted Advanced Measurement Approach (AMA) for management and calculation of Operational Risk capital, based on the Basel II requirements (Bank for International Settlements, 2006). The research was conducted under the assumption that when Operational Risk tools are adopted and used as prescribed by the Basel II Framework, it will lead to enhanced risk management practices and allow banks to identify emerging risks where controls can be designed to mitigate risks from materialising. This study was conducted using a quantitative method – the survey was sent to Operational Risk managers in the main segments of 3 South African AMA banks (ABSA, FIRSTRAND and NEDBANK), and senior managers in the group Operational Risk departments. The study found that Operational Risk tools are used and have been implemented as per Basel II requirements even though there are minor gaps. These tools have also been integrated in day-to-day processes; however there are some improvements required when it comes to a full integration and the use of the tools in the decision making processes. / Dissertation (MBA)--University of Pretoria, 2012. / Gordon Institute of Business Science (GIBS) / unrestricted

Links & Downloads

1. http://hdl.handle.net/2263/26522
2. Modiha, P 2011, Critical evaluation of operational risk tools used in regulatory capital calculations, MBA dissertation, University of Pretoria, Pretoria, viewed yymmdd < http://hdl.handle.net/2263/26522 >
3. F/12/4/720/zw
4. http://upetd.up.ac.za/thesis/available/etd-07212012-192025/

Tags

UCTD

Key risk indicators

Risk scenarios

Internal and external loss data

Basel ii framework

Risk and control self assessments

Internal audit findings

Additional Fields

Identifer	oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:up/oai:repository.up.ac.za:2263/26522
Date	21 July 2012
Creators	Modiha, Pulane
Contributors	Mr S Moyo, [e-mail]
Source Sets	South African National ETD Portal
Detected Language	English
Type	Dissertation
Rights	© 2011, University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria.