Volume : III, Issue : I, January - 2013

Operational Risk Management in Banking Sector: An overview

Rakesh Chutia

Abstract :

Operational risk is inherent in all banking products, activities and processes and systems and the effective management of operational risk is of paramount importance for every bank’s board and senior management. With globalization and deregulation of financial markets, increased competition combined with the advent of high–end, innovative, sophisticated technology tremendous changes have taken place in the products distribution channels and service delivery mechanism of the banking sector. These have introduced more complexities into the banking operations and consequently the risk patterns and profiles of the industry have also become complex, diverse and catastrophic. The New Capital Adequacy Framework of the Reserve Bank of India requires bank to maintain capital explicitly towards operational risk. This paper tries to study the various methodologies used by the banks in their operational risk management activity and to study the regulatory framework related to operational risk management.

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Article: Download PDF   DOI : 10.36106/ijar  

Cite This Article:

Rakesh Chutia Operational Risk Management in Banking Sector: An overview Indian Journal of Applied Research, Vol.III, Issue.I January 2013

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