The Measurement and Management Approaches to Operational Risks of Commercial Banks and the Application

Scientifically and effectively measuring and managing operational risk is of great significance to the security and stability of Chinese commercial banks. Internal and external frauds are main operational risks faced by Chinese commercial banks. Large-sized commercial banks in China have formulated policies on operational risk management and made some achievements. However,in general,Chinese commercial banks are still at the initial stage in operational risk management. Due to lack of data base and technological disadvantages,to utilize complicated mathematical models to measure operational risk requires a long process. Drawing on the experience of internationally leading banks,Chinese commercial banks should improve their overall understanding to operational risk,incorporate operational risk management into enterprise-wide risk management system,accelerate to establish data base about operational risk loss and actively further the quantitative management of operational risk.