This is an intensive course on Operational Risk Management & Mitigation – from assessing the operational risks to how to implementing a working, viable operational risk management system. Aimed at the financial services industry this course explores the Operational Risk Management (ORM) function and mitigation requirements as mandated in the Basel Accords.
A key objective of this course is to move the participants beyond the operational risk compliance requirements set down in the Basel Accords to an understanding of managing operational risk as a value added proposition that can be instrumental in increasing the profitability of the bank while at the same time improving its structural strength.
Now in 2014, the ongoing continuum of headline-grabbing operational risk incidents at banks, other financial institutions and even regulators continue to keep the issue of operational risk management at the top of agendas of CEO’s , CRO’s, Risk Managers and Internal & External Auditors alike.
These incidents are wide ranging and flow from bank ATM collapses, bank operating system failures, regulatory settlements in the ongoing US sub-prime mortgage saga, rogue traders and the connected risk managers who either missed or were willfully blind to all the warning signs.
As the size and complexity of financial institutions have increased, so too have the challenges of understanding and reducing operational risks down to truly manageable levels. Increased regulatory concern and scrutiny have also increased the cost of operational risk events in the shape of outright financial loss, regulatory fines and declining customer confidence
ORM is an effective tool for not only maintaining but increasing, bank profits, shareholder value, public perceptions and goodwill.
Executed properly, improvements in ORM can lead to substantial financial, reputational and regulatory benefits – all this adds to increased profitability, greater financial stability and improved customer satisfaction – in short, a better safer bank/ financial institution.
But to achieve these gains, financial institutions must apply a consistent and comprehensive approach to managing their operational risks. They must also understand that this approach is fundamentally different from the approaches that they use in managing market, credit and liquidity risks.
“Bad” ORM has a severely negative effect on financial institutions in four very clear ways;
- Actual operational risk losses are a direct hit to the income statement. Equally the massive fines being paid have the same effect.
- The market punishes companies, via the stock price, for operational risk failures. This loss of value could well exceed the actual financial loss experience by the risk event in the first place.
- Lowered Credit Ratings, which raises the institutions cost of borrowing money in the marketplace.
- Operational risk failures can vastly increase the cost of compliance by raising the level of regulatory scrutiny and complexity not to mention substantial penalties.
All too often banks have seen the need to effectively manage their operational risks as simply an issue of complying with what the bank regulator requires, in this case the operational risk requirements of the Basel Accords, rather than a disciplined process in its own right, that serves to not only ensure a banks survival but which can, in the long run, contribute to that bank’s financial fortune.
Implementing an effective ORM routine (“Good” Operational Risk Management) is a complex process. At its core is an understanding of what operations risk is and how it can be managed.
This course is an intensive introduction to operational risk management and mitigation. It is designed to provide a practical “hands-on” approach to participants which will furnish them with all the tools and techniques they need to begin implementing what they have learned as soon as they return to the office.
The underlying course philosophy is to move the participants beyond the largely theoretical international compliance requirements for operations risk (specifically those contained in the Basel Accords), and into an understanding of the practice of operations risk management and an ability to actually implement these procedures.
Operations Risk -
Active Management & Compliance
Which organizations should attend?
- Commercial Banks
- Central Banks
- Investment Banks
- Bank Regulators
- Asset Management Firms’ Representatives
- Pension Funds
- Hedge Funds
- Leasing Companies
- Insurance Companies
- Fund Managers
- Other Financial Institutions
Who should attend the Course?
- Financial Officers
- Risk Officers
- Internal Auditors
- Operational Risk Managers
- Compliance Officers
- Staff with roles and responsibilities in operational risk in risk management departments, businesses and central departments
- All front-, middle- and back-office staff in operational roles
- This course is not restricted to management staff alone but to all staff who are required to be “Operational Risk” aware
The objectives of this training course is to provide all staff, irrespective of whether they work in the front-, middle- or back-office, with a sound foundation in the theory and practice of ORM. This training is provided in a practical “hands-on” manner that allows them to implement what they have learned easily and effectively the minute they return to the office.
What this course covers
This course provides a complete structured package for learning in all main aspects of the subject of managing operational risk under the Basel Accords. It will enable participants to prepare and manage the planning and implementation of operational risk management processes in their bank/ financial institution or firm.
Key objectives and learning outcomes
The aim of the course is to provide:
- An understanding of risk in all its facets
- What the Basel Accords say about operational risk and its mitigation
- An understanding of operational risk techniques for assessing, managing and mitigating operational risk
- A link between ORM theory & practice
- A clear “road-map” on how to implement an ORM structure in practice in a banking organization.
This training course uses a combination of prepared tuition, examples, discussions, exercises and case studies. Most importantly it will offer participants, opportunities to share experiences and plan work within small working groups, providing practice in the application of the techniques and tools generating active participation.
We are registered with and adhere to the Statement on Standards for Continuing Professional Education programs of the National Registry of CPE Sponsors. Our registration number is 109066. Please check with the governing body of your license and state for specific CPE requirements. Grievances may be forwarded to the company at Ph: 650 620 3961; email: firstname.lastname@example.org. Grievances may also be forwarded to the National Registry of CPE Sponsors-NASBA, 150 Fourth Avenue North, Suite 700, Nashville, TN 37219-2417, 615-880-4200, www.nasba.org, e-mail email@example.com.
Field of Study:
Program Delivery Method: Group-Live
Program Level: Basic
Advance Preparation/Program Prerequisites: None