Euromoney Audit Training

By attending this program you will learn about:

Instruction on a wide range of treasury products and markets

The current state of Operational Risk and Operational Risk Management

Corporate governance for ORM

Developing a risk appetite statement for ORM.

Ways to use mitigated risks as a way to determine the value of ORM

Development of Key Risk Indicators (KRIs) at the business unit and organization levels

Managing ORM in a multi-country environment

Effective reporting and management of ORM

ORM modeling best practices

Correlation of risks

Course Background

This three day workshop takes a hands-on approach to Advanced Operational Risk Management (ORM) and provides delegates with the information to further build and enhance their ORM program. Delegates will learn how to transform the building blocks of their firm's operational risk management programs into a solid operational risk management strategy.

This advanced course examines operational risk management in the financial services industry by examining current and emerging practices in the operational risk management discipline, and the organizational, regulatory, and governance factors that affect how a financial institution addresses operational risk. Participants will build a solid conceptual foundation and apply this in practice through handson case studies and exercises.

Who should attend

• Treasury professionals at financial institutions
• Operational risk managers
• Governance, risk and compliance professionals
• Regulatory supervisors at financial institutions
• Professionals taking on broader operational risk management responsibilities and want to build a more strategic understanding of operational risk management.
  

Day 1

The Current State of ORM

• The role of treasury in modern organizations
• Reviewing established ORM programs for their successes and failures
• Moving from granularity to materiality
• Adding transparency to the controls environment
• Benefit/cost analysis of ORM

Corporate governance and ORM

• Characteristics of short-term government bills and commercial paper
• The role of the Board and Executive management in an ORM program
• Internal audit’s responsibility in ORM
  

Creating value with ORM

• Definitions and characteristics of bonds
• The development of a risk appetite statement
• All risks at some time wind up impacting the balance sheet and income statement. Understanding this and how to
  translate measurement and management into value will be explored.

Case Study

Day 2

Various frameworks for ORM

• COSO, COBIT, Basel II, Sarbanes Oxley and other formal rules and frameworks will be discussed and their application reviewed

Creation, Building and Running ORM – The Strategic Components

• In this advanced program, the focus will be on the strategic utilization of the ORM program

Building the ORM process

• Independence
• Risk mapping
• Defining Materiality
• Activity mapping
• Discussion of these four criteria in the context of:
  – Board of Directors requirement
  – CEO and management concerns
  – Back, Middle and Front office concerns
  – Regulatory drivers
• Scenario Analysis – using scenarios to set risk tolerances and
  capital levels 

Internationally active bank criteria

• Establishing a system with clear responsibilities assigned toan ORM function
  – How to assess, monitor, control and mitigate OR
  – Codifying firm level policies and procedures
  – Design and implement a firm’s OR assessment methodology
  – Design of risk reporting system

Case Study

Day 3

Components of an effective ORM and utilization of results - Regulatory expectations for the advanced practitioner

• ORM Management and data quality
  – Following and collecting data by business line
  – How to integrate this into the risk management process of the organization
  – How to make this an integral part of the organization’s OR profile
  – Making the information play a prominent role in risk reporting, management reporting and risk analysis
  – Distinguishing losses between risk categories (credit, market, interest rate, etc.)
  – Allocation of losses
  – Use of scenarios in OR
  – Identifying and using KRI’s
  – Risk control self assessments
• Measurement of OR
  – Establishing the risk profile of the organization
  – Operational VaR and regulatory capital calculation
  – Relating OpVaR to Credit VaR and Market VaR
  – Examples using OpVaR
  – Extreme Value Theory and OpVaR
  – Calculating OpVaR
  – Review of vendor data as a proxy for the organization
  – Regulatory capital allocation
  – Introduction to AMA modellingMeasurement of OR
• Regulatory expectations
  – On-site versus off-site monitoring
  – Public disclosure

Case Study
 
Course summary and close

• John Hurlock

  John is the Managing Director of SmarterRiskManagement, a consultancy that works with financial institutions on risk related projects and issues. The focus of the consultancy is on the development and implementation of Enterprise Risk Management (ERM) programmes and the component parts.

  Before founding SmarterRiskManagement, John was the Director of Integrated Risk Management Consulting Services for Metavante Corporation, a $2 billion technology firm focused on financial institutions.

  John has almost 30 years of experience in financial institutions as a practitioner and a consultant. His first fifteen years were spent working for financial institutions of various size and complexity, and has spent the last twelve plus years in the business consulting arena. During John’s banking career, he worked in several areas of banking including credit, treasury services and operations.

  During John’s consulting career he has worked with domestic and international financial institutions ranging in size from the community bank market to a US$1 trillion international financial institution. He has assisted banks as they have worked through regulatory orders and issues and been heavily involved in the roll out of advanced risk analytics including risk-based capital, the Basel II Accord and stress testing.

  John has presented courses throughout the United States, Europe, the Middle East and Africa. Programmes and workshops include the topics of Credit Risk, Market Risk, Operational Risk, Basel II and Strategic Planning. An area John has spent considerable time in is leading workshops for bank boards on the topics of corporate governance and risk management.

  John has an undergraduate degree in Economics and an MBA from the University of Wisconsin. He is currently an adjunct professor for Webster University, teaching in their MBA programme. He teaches Investment, Capital Markets and Management. John has also authored several articles and white papers and is a sought after speaker at banking conferences.

  Courses run by this instructor

  • Enterprise Risk Management and Value Creation - Paris

Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.

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