Headlines Powered by Business Wire: " Managers Expect Substantial Returns from Risk Management Programs without Much Investment in Technology, Support
A global survey of 400 risk managers at 300 financial institutions indicates that although operational risk management is moving up in the priority list for financial institutions, they are still suffering annual losses incurred through poor operational risk management that range into the millions of dollars. The survey of corporate risk managers, the most comprehensive of its kind to date, was conducted by the Risk Waters Group and SAS, the market leader in business intelligence.
The results show that a fifth of all companies in the financial sector still do not have an operational risk management program, despite the fact that 90 percent of them lose more than $10 million a year because of poor risk management.
Even those companies that have put programs in place are reluctant to invest the money for a framework, such as personnel and additional software functionalities, needed for it to work. Despite annual losses that cost the industry hundreds of millions of dollars, 33 percent of the risk managers surveyed expect to spend $1 million dollars or less in improving operational risk management in 2003. "
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Comment:
$10M.year is not enough of a loss to get any board member
upset at a large money center bank. What is more of a concern
is that 20% of the financial sector still does not have an
operational risk management program, regardless of the amount
being allocated for spending.
