Management of Behavioral Risk in the First Line of Defence

IF 0.4 4区经济学 Q4 BUSINESS, FINANCE

Journal of Operational Risk Pub Date : 2017-09-14 DOI:10.21314/JOP.2017.199

Jürgen Bott, U. Milkau

引用次数: 1

Abstract

Events in the last decade (such as the financial crisis, the settlement of legal claims against banks and criminal activity in the form of rogue trading) have underlined the importance of non-financial risks for banks, ie, risks other than market or credit risk. Approaches to dealing with non-financial risk range from risk governance to the methodology of modeling risk. The behavior of decision makers has been identified as a new type of risk: behavioral risk. However, less attention is paid to behavioral risk management in the first line of defence. This paper discusses key features of fighting behavioral risk in the business line of operations as the central hub for all transactions in a bank. Starting with examples such as best practice in aviation, it will examine different possible solutions, from training single subject-matter experts to communication at enterprise level.

查看原文本刊更多论文

行为风险管理的第一道防线

过去十年发生的事件(如金融危机、针对银行的法律索赔和解以及流氓交易形式的犯罪活动)强调了非金融风险(即市场或信用风险以外的风险)对银行的重要性。处理非财务风险的方法包括从风险治理到风险建模方法。决策者的行为被认为是一种新的风险类型:行为风险。然而，人们对第一道防线中的行为风险管理关注较少。本文讨论了作为银行所有交易的中心枢纽的业务线中对抗行为风险的关键特征。从航空领域的最佳实践等例子开始，它将研究不同的可能解决方案，从培训单一主题专家到企业层面的沟通。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Journal of Operational Risk BUSINESS, FINANCE-

CiteScore

1.00

自引率

40.00%

发文量

期刊介绍： In December 2017, the Basel Committee published the final version of its standardized measurement approach (SMA) methodology, which will replace the approaches set out in Basel II (ie, the simpler standardized approaches and advanced measurement approach (AMA) that allowed use of internal models) from January 1, 2022. Independently of the Basel III rules, in order to manage and mitigate risks, they still need to be measurable by anyone. The operational risk industry needs to keep that in mind. While the purpose of the now defunct AMA was to find out the level of regulatory capital to protect a firm against operational risks, we still can – and should – use models to estimate operational risk economic capital. Without these, the task of managing and mitigating capital would be incredibly difficult. These internal models are now unshackled from regulatory requirements and can be optimized for managing the daily risks to which financial institutions are exposed. In addition, operational risk models can and should be used for stress tests and Comprehensive Capital Analysis and Review (CCAR). The Journal of Operational Risk also welcomes papers on nonfinancial risks as well as topics including, but not limited to, the following. The modeling and management of operational risk. Recent advances in techniques used to model operational risk, eg, copulas, correlation, aggregate loss distributions, Bayesian methods and extreme value theory. The pricing and hedging of operational risk and/or any risk transfer techniques. Data modeling external loss data, business control factors and scenario analysis. Models used to aggregate different types of data. Causal models that link key risk indicators and macroeconomic factors to operational losses. Regulatory issues, such as Basel II or any other local regulatory issue. Enterprise risk management. Cyber risk. Big data.