New Field in Financial Risk: Study on Measurement and Management of Operational Risk

Operational risk is just turning into the important research interest in risk management of world banking system. The characteristic of operational risk is that the risk occurred in low frequency but with high losses. And the loss distribution is brilliant fat-tailed. This article thinks that banks should strengthen operational risk management and allocate certain amount of capital in order to keep away the risk after analyzing the means of measurement and management of operational risk and the model application.