
4 Operational Risk Control
human-engineered, and due to counterparties or generally external factors. Banks that
have studied the origins of op risk appreciate that:
䊏 It is causal
䊏 It is event-oriented, and
䊏 Its aftermath is loss and damage.
Key indicators for operational risk include: outstanding risk claims; number of
errors, by channel; frequency of other incidents; impact of each class of incidents in
economic terms; legal issues connected to op risk; level and sophistication of staff
training; staff turnover; and the way in which jobs are organized and supported –
including information technology (IT) supports. Operational risk often results in ...