The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

Banks face risky business of Basle

Operational risk is not new – it’s a concept that banks have been struggling with for years with varying degrees of success. But setting aside capital against the risk of loss from human error, systems failure, or fraud is new, and of growing concern to the industry. With the Basle Accord’s capital requirements coming into effect in January 2005, banks and other financial institutions are having to face operational risk issues with a new sense of urgency. In the following roundtable discussion, euromoney.com brought together a number of professionals with different operational risk challenges to discuss the questions they face and the business implications of the Basle Accord. IBM’s Keith Saxton moderated

       
Keith Saxton

Keith Saxton: We know operational risks are growing rapidly - those related to human mistakes, fraud, and legal and regulatory issues being the most common - and I think September 11 has heightened the real focus on this issue. However, designing and implementing an effective enterprise-wide risk management and control system is one of the most difficult issues facing markets and banks today. What does it mean for the balance sheets of both small and large banks and how can they manage the effects of the Basle Accord?

Jeremy Quick: We are concerned. That's not to say we are against operational risk at all - we know that's the way firms earn money - we are anxious to ensure that firms know what sort of operational risk they are taking on. We also want to ensure they are comfortable that the level of operational risk that they take on can be handled both in terms of systems controls and also in terms of solvency.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree