Implementing Operational Risk Programs in Consideration of Basel II / III

Financial sector competitiveness in the marketplace can be challenging without the presence of effective risk management strategies.  As companies continue to experience unprecedented business climate changes through transaction processing, new regulations, operational management systems, controls; the need for improving information quality, efficiency and strengthen corporate governance strategy in the sector is inevitable. This is reflective of a growing market need to understand an organization’s risk exposure and its ability to address risk.

 

After reviewing the impact of the Global Financial Crisis on Financial Institutions of all sizes,global regulators have pushed through a historic remake of the world's banking regulations forcing financial institutions to increase protections against unexpected losses.

 

In order to reduce risk exposure through appropriate risk mitigation processes, financial organizations need to put a stronger focus on information quality management and the uncertainties about the information can increases operational losses. In December 2010, the Basel Committee published the Basel III global regulatory framework. In November 2011, the G20 Leaders emphasized the importance of implementing Basel III fully and consistently in order to improve banks’ resilience to financial and economic shocks. Basel III imposes tougher capital requirements on banks around the world.