Bank Risk Management

Course details

During this course, participants will learn the concept of risk management, its function and processes in the banking environment. Participants will learn to apply the methodologies for identifying and measuring credit, operational, market, and liquidity risk. They will also learn the Basel core principles of risk management, the modern standard for risk management in the banking environment.

Course Objectives:

• Explain the concept and function of risk management
• Explain and measure credit risk
• Define operations risk and methodologies for measuring it
• Define market risk and methodologies for measuring it
• Define liquidity and the core principles for managing it
• Describe the Basel core principles of risk management

Course Outline:

Module 1: Introduction to Risk Management

• The concept of risk management
• The risk management function
• The risk vs. return trade-off
• Types of banking risk
• Simple statistical methods for risk measurement

Module 2: Credit Risk

• Introduction to credit risk
• The core principles of credit risk management
• Credit risk measurement methods
• Measuring credit risk based on the standardized approach
• Credit risk mitigation techniques
• Measuring credit risk based on internal risk rating-based (IRB) approaches
• The IRB structure and concept
• Fundamental and advanced IRB approaches
• Credit scoring models

Module 3: Operational Risk

• Introduction to operational risk
• The core principles of operational risk management
• Methods of operational risk measurement
• The basic indicator approach
• The standardized approach
• The advanced measurement approach
• The application criteria

Module 4: Market Risk

• Introduction to market risk
• The core principles of market risk management
• The standardized approach
• The internal model approach

Module 5: Liquidity and Other Risks

• Introduction to liquidity and other risks
• The core principles of liquidity risk management
• The core principles for the management of electronic banking operations risk

Module 6: The Basel Core Principles of Risk Management

• The importance of risk management
• The Basel core principles of risk management

Assessment Strategy:

Participants will be informally assessed on their interaction during sessions and their participation in exercises