Operational Risk Measurement

Gabriela Anghelache, Ana-Cornelia OLTEANU (puiu) and Alina-Nicoleta Radu

European Research Studies Journal, 2010, vol. XIII, issue 1, 215-223

Abstract: Beginning with the fact that performant strategies of the financial institutions have programmes and management procedures for the banking risks, which have as main objective to minimize the probability of risk generation and the bank’s potential exposure, this paper wants to present the operational risk measurement. Therefore, the first part presents the conceptual approach of the operational risks through the point of view of the financial institutions exposed to this type of risk. The second part describes different measurement methods for the operational risk. The final part of this article presents the approach assumed by a financial institution with a precise purpose: the quantification of the minimum capital requirements of the operational risk*. *Taking into consideration the values obtained we can mention that in the case of Standard Approach we have a different percentage of the needed capital in comparison with the Advanced Approach. Therefore in the second case we concluded that the percentage needed by a bank is 12, which is less than 15, the percentage needed in the first case.

Keywords: operational risk; operational risk management; Basic Indicator Approach; Standard Approach; Advanced Measurement Approach (search for similar items in EconPapers)
JEL-codes: C02 G21 G32 N20 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ers:journl:v:xiii:y:2010:i:1:p:215-223

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