Operational Risk Classification by Event Type
Operational risk refers to the risk of loss resulting from inadequate or failed internal processes, people, systems, or external events. To effectively manage and mitigate such risks, organizations—particularly in the financial sector—commonly classify operational risk events by event type. This classification framework, widely adopted and promoted by the Basel Committee on Banking Supervision, helps institutions…
Read article Classification of Operational Risk
Operational risk refers to the potential for loss resulting from inadequate or failed internal processes, people, systems, or from external events. To effectively manage and mitigate these risks, financial institutions and other organizations categorize operational risk into specific types. This classification aids in identifying risk sources, designing control mechanisms, and enhancing overall operational resilience. Key…
Read article Understanding Operational Risk: Definition, Scope, and Management
Introduction Operational risk has emerged as a critical area of concern in modern banking and financial management. Initially viewed as a residual or unquantifiable category, the definition of operational risk has evolved through extensive analysis and regulatory refinement. It is now recognized as a distinct and measurable form of risk with significant implications for business…
Read article Operational Risk Management and Integrated Risk Management: A Comprehensive Overview
Operational Risk Management (ORM) Definition:Operational Risk Management (ORM) is the structured process of identifying, assessing, and mitigating risks that may disrupt an organization’s routine operations. Focus:ORM concentrates specifically on risks originating from internal processes, human errors, system failures, and other operational activities. Goal:The primary objectives of ORM are to protect value creation, uphold stakeholder confidence,…
Read article
RBI Issues Draft Guidelines on Digital Banking Channels: Proposes New Compliance Norms and Ban on Third-Party Promotions
The Reserve Bank of India (RBI) has issued the draft “Digital Banking Channels Authorisation Directions, 2025”, introducing a comprehensive regulatory framework aimed at strengthening the governance, security, and transparency of digital banking services. The draft proposes significant restrictions, including a prohibition on the display of third-party products and services on banks’ digital platforms, and mandates…
Active Credit Portfolio Management: A Dynamic Approach to Credit Risk and Return Optimization
Active Credit Portfolio Management (ACPM) represents a strategic and proactive methodology for managing a financial institution’s credit portfolio. Unlike traditional static approaches that focus primarily on loan origination and hold-to-maturity strategies, ACPM emphasizes dynamic decision-making, continual monitoring, and tactical adjustments to optimize risk-return outcomes and support institutional objectives. This approach is increasingly vital in today’s…
Read article