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Operational Risk Management in a Financial Institution

Author

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  • Mitică Pepi

    (“Ovidius†University of Constanta)

Abstract

Risk is a fundamental business factor, mostly because no activity can be profitable without risk. Therefore, any business company is trying to maximize its profits by managing the risk specific to its field of activity and by avoiding or transferring the risk that it does not want to take over. A robust banking strategy should include both bank risk management programs and procedures that aim to minimize the likelihood of these risks and the potential exposure of the bank. This stems from the primary objective of these policies, namely to minimize the additional losses or costs borne by the bank, and the central objective of banking activity is to gain the most profit for shareholders.

Suggested Citation

  • Mitică Pepi, 2019. "Operational Risk Management in a Financial Institution," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 840-849, December.
  • Handle: RePEc:ovi:oviste:v:xix:y:2019:i:2:p:840-849
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    References listed on IDEAS

    as
    1. Anthony Santomero, 1997. "Commercial Bank Risk Management: An Analysis of the Process," Journal of Financial Services Research, Springer;Western Finance Association, vol. 12(2), pages 83-115, October.
    2. Aebi, Vincent & Sabato, Gabriele & Schmid, Markus, 2012. "Risk management, corporate governance, and bank performance in the financial crisis," Journal of Banking & Finance, Elsevier, vol. 36(12), pages 3213-3226.
    3. Suren Pakhchanyan, 2016. "Operational Risk Management in Financial Institutions: A Literature Review," IJFS, MDPI, vol. 4(4), pages 1-21, October.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Gerhard Philip Maree Grebe & Johan Marx, 2023. "The Perceived Relationship between Risk Culture and Operational Risk Management Practices of Ghanaian Banks," JRFM, MDPI, vol. 16(9), pages 1-22, September.

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    More about this item

    Keywords

    operational risk; financial institution; banking; risk evaluation;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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