...Operational Risk Management Interpreting Operational Risk Operational risk is the risk of loss resulting from inadequate or failed internal processes, people, systems and external events. This definition includes legal risk but excludes reputational risk and strategic risk. Therefore, in line with the Basel II risk management framework and best practices, operational risk in the Bank is composed of the following risk types: operations risk, legal risk, regulatory compliance risk, financial crime risk, people risk, property, technology, vendor, financial, and environmental risk. KIRU HAS A SMALL PART (TYPES OF OPERATIONAL RISK) HERE.WE WILL SEND YOU TODAY ITSELF.IF NOT IGNORES THAT PART. Operational risk management at NDB Operational Risk Management at NDB Operational risk is recognized as a distinct risk category which the Bank strives to manage within acceptable levels through sound operational risk management practices. The Bank's approach to managing operational risk is to adopt practices that are most appropriate and relevant considering the organizational maturity and business environment. Operational risk exposure is managed through comprehensive set of internal controls and management processors that cover risk assessment (Identification, description and estimation), risk evaluation, reporting, mitigation, residual risk reporting and monitoring and control associated with our business operations as an ongoing activity. Further, the Bank recognizes the significance...
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...fair-trade coffee and against Nike over sweatshops in Asia, like the Center for Science and Environment’s (CSE) attack on Coca-Cola India, are all examples of NGOs using companies’ powerful reputations against them. Being an attractive target, however, need not imply vulnerability. Organizations and their leadership teams need to start thinking systematically, proactively, and strategically about their reputational risk from crises concerning CSR (corporate social responsibility) and take actions to mitigate these risks before they become reality. The CSE’s allegations of pesticide-contaminated Coke and Coca-Cola India’s response provide an important example of the world’s most important brand under attack and the steps taken in the aftermath. This example highlights the importance of a strong reputation, a willingness to collaborate, and a strategic response to successfully weathering the crisis. Purpose of the Case Study 1. To give students the opportunity to apply a strategic framework to corporate communications, in a foreign context, with a global brand 2. To identify how, why, and where an organization is vulnerable to a...
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...University, Charleston, IL, USA ABSTRACT Crisis managers benefit from understanding how crisis communication can be used to protect reputational assets during a crisis. Situational Crisis Communication Theory (SCCT) offers a framework for understanding this dynamic. SCCT provides a mechanism for anticipating how stakeholders will react to a crisis in terms of the reputational threat posed by the crisis. Moreover, SCCT projects how people will react to the crisis response strategies used to manage the crisis. From its empirical research emerges a set of evidence-based crisis communication guidelines. The development of SCCT is discussed along with the presentation of its guidelines for crisis communication. Corporate Reputation Review (2007) 10, 163–176. doi:10.1057/palgrave.crr.1550049 KEYWORDS: crisis communication; crisis man- agement; reputation INTRODUCTION Crises are taken as a threat to the organizational reputation. Crises damage the reputation and such changes can affect how stakeholders interact with the organization (Barton, 2001; Dowling, 2002). Postcrisis communication can be used to repair the reputation and/or prevent reputational damage (Coombs and Holladay, 2005). The field of crisis communication is dominated by case studies. The end result is that we know precious little about how stakeholders react to crises or to the crisis response strategies used to manage crises (Ahluwalia et al., 2000; Dawar and Pillutla, 2000; Dean, 2004). Crisis management...
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...2. IDENTIFY STRATEGIC QUESTIONS FACING COCA-COLA INDIA. (FIVE AT THE MOST) The Coca Cola Company (Coca- cola) is a leading manufacturer, distributor and marketer of Non-alcoholic beverages concentrates and syrups, in the world the company owns licenses of more than 400 brands, including diets and light beverages, water, juice and juice drinks, teas, coffees, and energy and sports drinks. The company operates in more than 200 countries. Ever since, Coca-Cola India has made significant investments to build and continually consolidate its business in the country, including new production facilities, waste water treatment plants, distribution systems, and marketing channels. Coca-Cola India is among the country’s top international investors, having invested more than US$ 1 billion in India in the first decade, and further pledged another US$100 million in 2003 for its operations. However due to certain strategic problems, Coca-cola India had to face certain tough competition with PepsiCo. India. In this segment, we try to discuss the strategic questions facing Coca-cola India. WEAKNESSES • Low Export levels: The brands produced by the company are the brands produced worldwide. In India, major controversies lie regarding the quality of the drink available to consumers, thus decreasing the export levels in the country. • Smaller Scale Sector Reservations Limit Ability To Invest and Achieve Economies Of Scale: the company’s operations are carried out on small scale and due...
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...Company: Risk assessment and internal controls Maastricht University School of Business and Economics Maastricht, 20 September 2013 Abel, S. I6077467 Isenia, N. I6064905 Liu, B. I6063209 Study: MSc IB Controlling Course code: EBC4069 Group number: 3 Tutor name: R. Maessen Writing assignment: Case Study RA The case study “ RA (Rest Assured) Insurance Company concerns a company that was involved in a large life insurance scam. RA was facing several risks that had a dramatic impact on the company because of bad decisions, lack of business controls, and a corporate culture that was inefficient and ineffective. The main objective of this case memo is to identify and appropriately assess the risks that the RA insurance company was facing. Further, this case memo introduces internal control solutions to manage those risks. Finally, this case memo provides examples of other companies that have faced problems similar to RA’s “churning” of policies. Identifying and assessing risks There are several strategic, sales & marketing, corporate culture, and corporate governance risks that are causing problems at RA. Firstly, the risk that the maximum amount of possible life insurance is reached is certainly a risk that RA is unable to manage. Although the overall number of life insurance policies was declining, RA continued to put its focus on this product. This might have put additional pressure on the sales force, forcing salesmen perhaps to commit fraud. Although this risk is difficult...
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...goal of the project. Conduct research to expand NewwDeal into three key areas: Mobile Applications, Wireless Security, and Cloud Computing. The intended business impact. Business Impact is: The consequences to the business (financial, reputational or operational) that could result Increased market share Customer Satisfaction The team members and their roles. For Week 5, team 3 member roles are: Mark Wetzbarger – Group Lead / PM Marlowe Jones – Deputy Lead / PM & Research Coronda Wilson - Complier Sudharma Thikkavarapu - Researcher Latoria Wilson - Researcher The scope of the project. http://www.tutorialspoint.com/management_concepts/project_scope_definition.htm http://searchcio.techtarget.com/definition/project-scope Should we have a scope statement, vice a scope in terms of time & money? Thoughts? The estimated cost. SWAG @ $100,000 The schedule, including the major milestones and a timeline. 6 Week schedule: Timeline & Milestones: Week 1: Complete and Deliver Project Charter Week 2: Complete and Deliver Project Risk Management Plan Week 4: Compete and Deliver Business Case Week 6: Complete and Deliver Business Case Presentation How the team will apply controls to manage the scope, cost, and schedule variables, including examples of control charts and...
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...capability & management of organic growth * Well below average in terms of the way it has managed acquisitions to date * Not seen as a global player measured against competitors * Its ownership of trade names and intellectual property rights is below the industry average Management of risk: * Its management of financial risk has dropped below average as a result of a sustained investment in acquisitions in recent years * Acquisitions have not been perceived as financially astute * Recent corruption scandal involving Raphael roux has damaged WRSX group’s reputational risk score. * The way the business is structured and managed, i.e. local autonomy and a light handed approach by the wrsx group board, results in a low score in terms of management of operational, market and business risk against the industry average. Leadership capability: * Most offices perform badly in terms of management of operations, information management and administration * Across the group scores average out at below the industry average. * WRSX performs well below the industry average in terms of its strategic leadership capability, its ability to lead and manage change and its ability to attract and...
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...RISK MANAGEMENT THE NIGERIAN BANKING SECTOR FOR ABI ALCHEMY BUSINESS INTELLIGENCE BY OYINDAMOLA OMOSEBI CONSULTANT ALCHEMY BUSINESS INTELLIGENCE 5TH MAY 2012 Table of Content 1.0 Overview of Risk Management 1.1 Principle of Risk Management 1.2 The Risk Management Process 1.2.1 Risk Identification 1.2.2 Risk Assessment/Measurement 1.2.3 Risk Mitigation 1.3 Risk Management Plan 1.3.1 Implementation 1.3.2 Review and Evaluation of Plan 2.0 A Review of Risks in Banking 2.1 Overview of Risk Management Practices in Nigerian Banks 2.1.1 Reputational Risk and Confidence Crisis in the Nigerian Banking Industry 2.1.2 Operational Risk 2.1.3 Credit Risk 2.1.4 Human Resources Risk 2.1.5 Risk Associated with Mergers and Acquisition 2.2 Current Regulatory and the Way Forward 3.0 Summary and Conclusion 1.0 Overview of Risk Management There is risk in every business because of uncertainty about future events and exposure, almost everything we do in the business world involves risk. This is the probability that organization or an individual will be unable to meet some expectations set for itself during a given period or could incur a financial loss because of some known or unknown threats or events outside his immediate control. Therefore, Risk Management is the identification, assessment, and prioritization of these risks followed by coordinated and effective application of resources to minimize, monitor, and control the probability and/or impact...
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...capital it lends out to customers (George 2000) Loans are the major asset for most banks. They earn more interest than banks have to pay on deposits, and, thus, are a major source of revenue for a bank. Often banks will sell the loans, such as mortgages, credit card and auto loan receivables, to be securitized into asset-backed securities, which can be sold to investors. This allows banks to make more loans while also earning origination fees and/or servicing fees on the securitized loans. (Spaulding 2005) Banks face a number of risks in order to conduct their business, and how well these risks are managed and understood is a key driver behind profitability, and how much capital a bank is required to hold. Some of the main risks faced by banks include, credit risk, liquidity risk, market risk operational risk and reputational risk. The goal of credit risk management is to maximise a bank's risk-adjusted rate of return by maintaining credit risk exposure...
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...Case Analysis – Risk Management at Wellfleet Bank: All That Glitters Is Not Gold. 1. Given its strategy, what kind of risks does Wellfleet Bank face? The first possible risk would be the operation risk. Refer to Wellfleet Bank, the Group Credit Committee has a unlimited level of authority. They could approve loans of any size within the bank’s regulatory limits which means there is no supervisory group can stop the group’s decision. Furthermore, to preserve the independence of the credit-approval process, the “Alpha Pass” did not involve the most senior executive management (e.g., business CEOs) in the deal flow. Under the current operation procedure, if a billion dollar deal went wrong it could sink the ship. The second possible risk is the regulatory risk. It is related to the compliance with the Basel II Standards and Credit Risks. The cost of operation will increase and the attractiveness of investment in Wellfleet Bank will decrease when the government amends or changes the law on banking regulations (e.g. more restriction). Thirdly, Wellfleet is also facing is the concentration risk. Refer to the case, Wellfleet has a pretty much higher concentration on its Corporate Banking Group. The group contributes around 60% of profit before taxes and 70% of bank assets in the last financial year (2007). As a result, the bank may suffer a huge loss if the business on corporate banking goes downwards. Last but not least, there are also many minor risks that Wellfleet...
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...Risk management Unit 6.4 Module name: - risk management ATHE Level 6 Diploma in Management (QCF) Submission by: - pritpal kaur sangha Student id:- Diploma in management Date:- Table of content Assignment 1 Introduction………………………………………………………………...3 1.1 An explanation of risk management……………………………............................3 1.2 how risk management affects different business functions………………………3 1.3 evaluation of methods of assessing risk in business……………………………...4 2.1 evaluation of approaches to managing risk in business…………………………4 Assignment 2 Risk assessment………………………………………………………5 3.1 All the main drivers of business risk…………………………..6 3.2 Impact of the different types of risk…………………………….7 3.3 of severity and likelihood of risk…………………………...8 3.4Suggested risk management strategies…………………………………9 4.1 Approaches to crisis management…………………………………………10 . 4.2 Impact of breaks in business continuity…………………………………………10 Conclusion…………………………………………………………………………11 References………………………………………………………………………….12 Risk Management Introduction: Risk management is an important concept mainly aims at identification, assessment, and prioritization of events that may have an adverse impact on the organization. It can be considered as a very powerful strategic tool and has become more prevalent in recent decades due to...
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...Bank Risks and Risk Factors Abstract The Federal Reserve System has established a banking risk framework that consists of six risk factors: credit, market, operational, liquidity, legal and reputational risks. During examinations, institutions' risk management structures are reviewed using these risk categories. The Federal Reserve Bank of Chicago (Seventh District) supervision group follows current and emerging risk trends on an on-going basis. This Risk Perspectives newsletter is designed to highlight a few current risk topics and some potential risk topics on the horizon for the Seventh District and its supervised financial institutions. The newsletter is not intended as an exhaustive list of the current or potential risk topics and should not be relied upon as such. We encourage each of our supervised financial institutions to remain informed about current and potential risks to its institution. Credit Risk The marketplace for C&I loans is highly competitive. Soft loan demand, the low interest rate environment, and strong market liquidity from banks and investors flush with cash has heightened the level of competition for C&I lending and will continue to make loan growth for our institutions very challenging into 2013. Anecdotally, financial institutions have responded to these dynamics in a number of ways, including: • Granting pricing and structural concessions in order to maintain or potentially grow market share • Increasing leverage tolerance ...
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...ways to transfer risk in financial markets. Although the financial innovations have only been used for decades, activity in credit derivations has grown rapidly. According to the Bank for International Settlement, the credit derivatives market reaches $21 trillion in 2014, and the main players for credit derivatives are investment banks, corporations or insurance companies. (Bank for International Settlement, 2014) Credit derivatives are relatively complex financial instrument, since it utilizes the leverage technique to mitigate the credit risk. One the one hand, credit derivatives allow banks to mitigate credit risk, reduce undesired risks and customize their risk profiles. On the other hand, the use of credit derivatives contains potential risks to the company since the market is still new. Users of credit derivatives must recognize and mange numerous associated risks. In fact, the historical evidence has shown that credit derivatives are the major causes to financial crisis. (Borodovsky & Lore, 2000) Although it is important to assess credit risk and market risk in the bank investment, operational risk is the fundamental part to the ultimate success of investment. “Operational risk is the risk of a breakdown in the operations of the derivatives program or risk management system.” (Chance & Brooks, 2012) Operational risk was generally defined as the failure in internal processes, people and systems or from external events. It could be interpreted that the risks result from human...
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...Best Practice in Risk Management in Banks A Two-day Practical Workshop The Workshop Objective: Bank managers will understand how risks are identified, quantified in terms of their impact on earnings, monitored and managed within banks. Program participants will become better equipped to: • • • Identify and quantify the bank’s vulnerability to credit, market, liquidity, operational, regulatory and reputational risks. Understand and learn best practice procedures to monitor and manage these risks and their impact on revenues. Relate these risks to bank capital. CONTENT I. ANALYTIC OVERVIEW Overview • Why risk management is critical to banks • Value drivers and business model of a bank. • Understanding differing perspectives: shareholders, regulators, and debt providers. Risk management • Major risk groups: credit, market, liquidity, operational. • Management objectives – risk versus return. • Lessons learned from recent risk management failures: sub-prime, CLOs, leveraged loans, trading losses and etc. Capital allocation • Types of capital: shareholder, regulatory and economic capital. • Economic capital: key management assumptions. • Regulatory capital Basel 1 versus Basel 2. • Managing capital structures: comparisons between banks. II. CREDIT RISK Identifying and quantifying the risk • Seven categories of credit risk: lending, contingent, issuer, pre-settlement, settlement, country/transfer, other. • Systems and procedures for quantifying and aggregating exposures. • • Bank...
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...HIPAA- How To Avoid Data Breach? How do data breaches occur? • we suspect our information system has been • targeted and patient information exposed. After one a laptop and other portable device is lost or stolen. • We did a rapid assessment to mitigation of damage and is and define scope of the incident we discovered following facts: – – – – data are not encrypted laptop are not protected by password Information of patients are exposed. No log file exist What are consequences of these breaches ? A data security breach can have devastating consequences for healthcare organizations as well as patients or clients What are our strategies to prevent theses breaches • We must be in compliance with the final HIPAA Omnibus Rule through following : – Administrative safeguards – Physical safeguards – Technical safeguards What is HIPAA? • HIPAA: Health Insurance Portability and Accountability Act • It was passed by Congress in 1996 • broadly applicable to the health care industry • intended to address security for both electronic and physical patient records • standardizing electronic exchange of administrative & financial data in health care system • It includes requirements for: • Transfer and continuation of health insurance coverage • Reducing healthcare fraud and waste – The protection and confidential handling of protected health information (PHI) What is a breach? – A breach is an impermissible use or disclosure that compromises the security or privacy of PHI and poses...
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