6.3 How to Implement the Operational Risk Management Proposal ...
6.3 How to Implement the Operational Risk Management Proposal ...
6.3 How to Implement the Operational Risk Management Proposal ...
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Strengths of Basel II <strong>Proposal</strong> for<strong>Operational</strong> <strong>Risk</strong> <strong>Management</strong>• Increased transparency both at branch level and business linelevel will help <strong>to</strong> control operational risk.• <strong>Risk</strong> <strong>to</strong>lerance level could be set.• <strong>Implement</strong>ation of Basel II will facilitate <strong>the</strong> transformationprocess of banking operation.-<strong>Management</strong> functioned by business line will be streng<strong>the</strong>ned;-Give incentive <strong>to</strong> improve operational risk management andhenceforth <strong>to</strong> reduce operational losses.• Encourage banks <strong>to</strong> allocate more sources <strong>to</strong> streng<strong>the</strong>n <strong>the</strong>iroperational management.2009-1-13 13•China Version of Guidelines for <strong>the</strong><strong>Implement</strong>ation of Basel II• Three approaches recommended by CBRC-The Standardized Approach in China Version-The Alternative Standardized Approach-The Advanced Approach• No detail about AMA, reflecting low expectation forimplementation.2009-1-13 14•7