Commercial Bank's Operational Risk Measurement And Prevention

The serious loss in operational risk incidents attracts widely attention of the whole banking. In the New Basel Capital Accord operational risk is brought into the risk management framework for minimum capital supervision, which pushed the development of operational risk management. Because the study on operational risk is late in our country and the management level is lagged, operational risk incidents happened frequently. So how to improve operational risk management level and prevent operational risk on the basis of improving operational risk measurement technique is the urgent task of our banking.Firstly, the paper expounds the connotation, the sorts and the characteristics of operational risk. According to the concrete manifestation the paper points out the internal reason and outside reason to operational risk of our banking, which indicates the importance and urgency of strengthening operational risk in our banking. In Chapter 3 the paper expounds all kinds of operational risk measurement and chooses income model that is most fit for our banking. Because there are some defects in income model the paper improves the model. In Chapter 4 taking example for five banks on the market the paper measure operational risk facing the five banks. When comparing relative value of the five banks'operational risk coefficient of variation is brought in. By analyzing the comparing result linking to the managing conditions of the five banks the paper demonstrates feasibility of income model. In Chapter 5 the paper puts forward suggestions on how to prevent operational risk, such as setting up operational risk reserve accounts, building up internal loss data, studying new measurement model, improving internal management, strengthening external supervision, etc.Banking is a risky industry. The management conditions of banking directly affect the stability of financial system and the society. Operational risk is a complex domain as well as a new problem, and there are many problems to resolve. By studying advanced operational risk measurement technique and management technique, our banking can form correct operational risk management ideas, strengthening operational risk measurement consciousness, gradually building up perfect operational risk management system, improving operational risk management level, then when competing with international banks our banking can succeed.