The necessity of operational risk management and quantification

Teodora Barbu, Olteanu (Puiu) Ana Cornelia () and Radu Alina Nicoleta ()
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Olteanu (Puiu) Ana Cornelia: The Academy of Economic Studies, The Faculty of Finances, Insurances, Banks and Stock Exchange
Radu Alina Nicoleta: The Academy of Economic Studies, The Faculty of Finances, Insurances, Banks and Stock Exchange

Annals of Faculty of Economics, 2008, vol. 3, issue 1, 661-667

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 management and quantification methods. Also it presents the modality of minimum capital requirement for the operational risk. 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 the management and evaluation 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.

Keywords: Operational risk; operational risk profile; standard approach; gross income; administrative general expenses (search for similar items in EconPapers)
JEL-codes: D80 G15 G21 (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ora:journl:v:3:y:2008:i:1:p:661-667

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