Operational Risk Committee Presentation Sample

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Information about Operational Risk Committee Presentation Sample

Published on June 25, 2009

Author: oaes2006

Source: slideshare.net

Description

Communication to Senior Management

BANK Operational Risk Committee MONTH 20XX

AGENDA ‣ Follow up ‣ Excessive Transaction on Savings Accounts (Reg D). ‣ Envios de Dinero Bancomer Discount Transactions ‣ Risk Factors Retail Banking. 2 Risk, 20XX

Follow up 3 Risk, 20XX

Excessive Transaction on Savings Accounts (Reg D). Risks Involved: Operational and Reputational Department  Monetary Penalty from Examiners Responsible: 1.-Automatic Notices in production. -Operations. Mmm 20XX 2.-Modify Current Policy and Procedure. ‣ Define control and responsible when the 4th -Operations, Legal excessive transaction occurs. & Compliance. Mmm 20XX‣ Define when the account may be closed ‣ Translation Scripts and Letter ‣ Include Central Operations process -Operations, Retail Banking & 3.-Branch Training. Compliance. Mmm 20XX -Audit & 4.-Follow up review by Internal Audit and Compliance. Mmm 20XXCompliance. 4 Risk, 20XX

Envios de Dinero Bancomer Discount Transactions. Risks Involved: Ineffectiveness in the control of Department operations  Potential Economical Loss Responsible: Discount Amount Transactions $XXX $XXX YYY (Mmm-XX / M-mmXX) No Account Holder $XXX $XXX YY YYY Discount Transactions YY YY $XXX YY YYY $XXX $XXX YYY YY YYY $XXX $XXX $XXX YYY $XXX $XXX YY YYY $XXX YYY $- 0 mm-XX mm-XX mm-XX mm-XX mm-XX mm-XX 2.- Incorrect discount of fees to Mexico. - Retail Banking & ‣ Each discount applied in Point of Sale Operations. according operation strategy and policy. 5 Risk, 20XX

Waived Transaction Fees. In the Money Transfer • Action Needed Each discount applied in Point of Sale has to be identified with an account holder. NOTE: Employee with no Bank account input customer ID number. •Why? To identify our Customers and their consumption patterns Marketing Cross selling •When? Effective immediately •How? Click on the Account Holder selection button and input the account number. 6 Risk, 20XX

Retail Banking ‣ Evro Excel tool. ‣ Identification of Risk Factors ‣ Measure Risk ‣ Analysis 7 Risk, 20XX

Retail Banking ‣ Identification of Risk Factors : 40 ‣ Eight Factors had the 80% of the annual impact ANNUAL % DESCRIPTION OF SPECIFIC OPERATIONAL RISK FACTORS DETECTED IN THE BUSINESS UNIT IMPACT Daily Balance process incorrect. The Cash Drawer is short resulting in a charged off. XXX 15% 15% Money Transfer Waived Fee. Incorrect discount of fee. XXX 14% 29% Phone cards reception, sale and shipment. Phone Cards inventory out of control resulting in the loss of phone XXX 11% 40% Cashier Check reception, sale and shipment. Cashier Check inventory out of Control resulting in a potential fraud with the monetary instrument. XXX 11% 51% Deposit Check Incorrect Hold. The Teller does not follow Hold policy and procedure resulting in a loss for the XXX 10% 61% Check Cashing Not sufficient funds Check. The Teller does not follow policy and procedure resulting in a loss for the bank. XXX 8% 69% Deposit Counterfeit Check. The Teller does not verify check's authenticity resulting in a loss for the bank. XXX 6% 76% Phone cards reception, sale and shipment. Phone Cards inventory out of control resulting in accounts XXX 4% 80% Money Transfer incorrect process. The teller types incorrectly the data of the recipient resulting in unrecovered money. XXX 3% 83% Deposit uncollected funds hold Check. The Check was returned because the funds have a hold, resulting in a loss for the bank. XXX 2% 85% 8 Risk, 20XX

Retail Banking ‣ Measure Risk ‣ The total Annual Impact is around $XXX ANNUAL IMPACT XXX RISK CLASS CODE PR - PROCESSES 101 – OPERATIONAL ERRORS PR - PROCESSES 102 – INEFFECTIVE CONTROL EF - EXTERNAL FRAUD 202 - THEFT AND BURGLARY XXX EF - EXTERNAL FRAUD 203 – OTHER EXTERNAL FRAUD BP - BUSINESS PRACTICES 601 - SUITABILITY, DISCLOSURE AND FIDUCIARY XXX IF - INTERNAL FRAUD 301 - THEFT AND FRAUD IT - TECHNOLOGY 401 - TECHNOLOGY AND INFRASTRUCTURE FAILURES XXX XXX XXX XXX YYY YYY RISK CLASS NAME RISK CLASS CODE ANNUAL IMPACT % PR - PROCESSES 101 - OPERATIONAL ERRORS XXX 50.28% 102 - INEFFECTIVE CONTROL XXX 26.54% PR - PROCESSES Total YYY 76.82% EF - EXTERNAL FRAUD 202 - THEFT AND BURGLARY XXX 16.57% 203 - OTHER EXTERNAL FRAUD XXX 5.53% EF - EXTERNAL FRAUD Total YYY 22.10% BP - BUSINESS PRACTICES 601 - SUITABILITY, DISCLOSURE AND FIDUCIARY XXX 0.54% BP - BUSINESS PRACTICES Total YYY 0.54% IF - INTERNAL FRAUD 301 - THEFT AND FRAUD XXX 0.26% IF - INTERNAL FRAUD Total YYY 0.26% IT - TECHNOLOGY 401 - TECHNOLOGY AND INFRASTRUCTURE FAILURES XXX 0.28% IT - TECHNOLOGY Total YYY 0.28% Grand Total YYY 100.00% 9 Risk, 20XX

Retail Banking ‣ Analysis Risk Recurring Damage to Image 22% Sum of ANNUAL IMPACT Very low - Almost no Data ZZZ Sum of RECURRING RISK unit customers are Sum of NON-RECURRING RISK affected. High - Most customers ZZZ 78% are affected. Medium - A significant ZZZ number of customers is Loss Type affected. Data Total Low - A reduced number ZZZ Count DIRECT LOSS RISK 37 DIRECT LOSS RISK Amount $ XXX of customers is affected. Count LOST PROFITS RISK 2 - 5ZZZ 1ZZZ 15ZZZ 2ZZZ 2ZZZ 3ZZZ LOST PROFITS RISK Amount $ XXX Count INDIRECT LOSS RISK 1 INDIRECT LOSS RISK Amount $ XXX 10 Risk, 20XX

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