Presentation is loading. Please wait.

Presentation is loading. Please wait.

Operational Risk and its impact on the Fund & Investment Management Industry An Insurance Perspective Angelos Deftereos Aon Limited 16th April 2003 Aon.

Published byMitchell Hawkins Modified over 6 years ago

Similar presentations

Presentation on theme: "Operational Risk and its impact on the Fund & Investment Management Industry An Insurance Perspective Angelos Deftereos Aon Limited 16th April 2003 Aon."— Presentation transcript:

1 Operational Risk and its impact on the Fund & Investment Management Industry An Insurance Perspective Angelos Deftereos Aon Limited 16th April 2003 Aon Limited is a member of the General Insurance Standards Council

2 Contents 1. What may be the extent of its impact?
2. What is Operational Risk? 3. How can you influence Capital Charge? 4. How may insurance assist? 5. Summary Aon Limited is a member of the General Insurance Standards Council

3 What may be the extent of it’s impact?
Study of impact on European Asset Managers Currently 13 week expenditure Impact - 20% increase for large asset managers - 60% increase for medium asset managers - ?% increase for small asset managers Source: Bank Reputation and Asset Management Industry: Professor Colin Meyer 2001 Aon Limited is a member of the General Insurance Standards Council

4 What is Operational Risk?
“The risk of loss resulting from inadequate or failed internal processes, people and systems or from external events.” Source: Basel II Consultative Paper January 2001 Revised Working Paper September 2002 Aon Limited is a member of the General Insurance Standards Council

5 What is the Regulatory Timeframe?
Jan 2001 Second Consultative Package End May 2001 Deadline for Comments September 2001 Issue of Working Paper on Operational Risk End October 2001 Deadline for Responses to this paper 4th Quarter 2002 Consultative Paper Three Issued 2003 Publication on the New Accord 2006 Implementation of the New Accord Aon Limited is a member of the General Insurance Standards Council

6 How can you influence the Capital Charge?
“Intention is to make minimum capital requirements of Banks more risk sensitive.” Basel II Consultative Paper January 2001 Aon Limited is a member of the General Insurance Standards Council

7 How can you influence the Capital Charge?
Aon Limited is a member of the General Insurance Standards Council

8 5 Steps to a Risk Management Framework
Identification & Risk Mapping Setting framework for implementation - Overall Operational Risk Strategy Definition of loss Set-up & implementation of data capturing mechanisms Assist in mapping losses into agreed risk categories

9 5 Steps to a Risk Management Framework
Quantification Application of modelling techniques Enhance external benchmarking, modelling & forecasting using Aon’s OpBase database

10 5 Steps to a Risk Management Framework
Risk profile Identify risk appetite benchmark peer & firms own actuarial trends analyse geographical factors overlay strategic vision aggregation issues market & credit risk diversification benefits

11 5 Steps to a Risk Management Framework
Risk solutions Internal solutions captive analysis / risk financing analysis / risk retention Insurance Mapping availability of insurance to risks identified Advise & agree appropriate retention level & limit Design insurance programme Provide a range of alternatives in conjunction with business goals Capital markets Hybrids

12 5 Steps to a Risk Management Framework
Monitoring & updating Assist in ensuring operational risk management strategy is implemented & maintained Updates on operational risk market developments

13 How may insurance assist?
Insurance Road Map Aon Limited is a member of the General Insurance Standards Council

14 0% 100% Hedge Aon Limited is a member of the General Insurance Standards Council

15 How may insurance assist?
Insurance Road Map Aon Limited is a member of the General Insurance Standards Council

16 Aon Limited is a member of the General Insurance Standards Council

17 How may insurance assist?
Expected Retained Severe Unexpected Catastrophic Unexpected Aon Limited is a member of the General Insurance Standards Council

18 How may insurance assist?
Catastrophic Unexpected Aon Limited is a member of the General Insurance Standards Council

19 Summary Fund Management industry will be impacted by the proposed new capital charges ‘Fat tail’ risks expensive to retain on balance sheet, risk transfer more economic Insurance market working to obtain regulatory relief for its products Insurance will form a more significant part of overall operational risk management strategy for Fund and Investment Management Industry Aon Limited is a member of the General Insurance Standards Council

20 Aon Professional Risks Telephone: 0207 668 9750
Angelos Deftereos Aon Professional Risks Telephone: Aon Limited is a member of the General Insurance Standards Council

Download ppt "Operational Risk and its impact on the Fund & Investment Management Industry An Insurance Perspective Angelos Deftereos Aon Limited 16th April 2003 Aon."

Similar presentations

Financial Conglomerates Koos Timmermans

Financial Conglomerates Koos Timmermans
Risk The chance of something happening that will have an impact on objectives. A risk is often specified in terms of an event or circumstance and the consequences.

Risk The chance of something happening that will have an impact on objectives. A risk is often specified in terms of an event or circumstance and the consequences.
British Bankers’ Association CRD 3 and beyond How are you left? Simon Hills British Bankers Association.

British Bankers’ Association CRD 3 and beyond How are you left? Simon Hills British Bankers Association.
THE ROLE OF THE ACTUARY IN THE ECONOMY

THE ROLE OF THE ACTUARY IN THE ECONOMY
Own Risk & Solvency Assessment (ORSA): The heart of Risk & Capital Management John Spencer Director, Ultimate Risk Solutions.

Own Risk & Solvency Assessment (ORSA): The heart of Risk & Capital Management John Spencer Director, Ultimate Risk Solutions.
1 Risk-Focused Surveillance Framework Enterprise Risk Management Symposium Chicago, Illinois April 26, 2004 Terri Vaughan, Iowa Insurance Commissioner.

1 Risk-Focused Surveillance Framework Enterprise Risk Management Symposium Chicago, Illinois April 26, 2004 Terri Vaughan, Iowa Insurance Commissioner.
1 The critical challenge facing banks and regulators under Basel II: improving risk management through implementation of Pillar 2 Simon Topping Hong Kong.

1 The critical challenge facing banks and regulators under Basel II: improving risk management through implementation of Pillar 2 Simon Topping Hong Kong.
Manulife Financial Corporation operates as John Hancock in the United States, and Manulife in other parts of the world. Enterprise Risk Management in Life.

Manulife Financial Corporation operates as John Hancock in the United States, and Manulife in other parts of the world. Enterprise Risk Management in Life.
Risk Management Assessment: The Canadian Banking System Nawal K Roy Vice President Risk Management Specialist Nawal K Roy Vice President Risk Management.

Risk Management Assessment: The Canadian Banking System Nawal K Roy Vice President Risk Management Specialist Nawal K Roy Vice President Risk Management.
ERM in the Rating Evaluation CAMAR Fall Meeting November 29, 2007 Thomas M. Mount, ACAS, MAAA Andrew Colannino, Vice President A.M.Best Company.

ERM in the Rating Evaluation CAMAR Fall Meeting November 29, 2007 Thomas M. Mount, ACAS, MAAA Andrew Colannino, Vice President A.M.Best Company.
IOR Scottish Chapter Annual Conference Glasgow Caledonian University – 1 st November 2013 Relevance of Operational Risk to the FCA Jill Savager Manager,

IOR Scottish Chapter Annual Conference Glasgow Caledonian University – 1 st November 2013 Relevance of Operational Risk to the FCA Jill Savager Manager,
The Walt Disney Company Risk Finance and Risk Management Strategy

The Walt Disney Company Risk Finance and Risk Management Strategy
A Training Session by National Community Capital Association 1 Risk Management for Loan Programs RESNA Alternative Financing and Telework Loan Programs.

A Training Session by National Community Capital Association 1 Risk Management for Loan Programs RESNA Alternative Financing and Telework Loan Programs.
Canadian Chartered Banks – Example of RBC

Canadian Chartered Banks – Example of RBC
Operational risk management Margaret Guerquin, FSA, FCIA Canadian Institute of Actuaries 2006 General Meeting Chicago Confidential © 2006 Swiss Re All.

Operational risk management Margaret Guerquin, FSA, FCIA Canadian Institute of Actuaries 2006 General Meeting Chicago Confidential © 2006 Swiss Re All.
Strategic Information Initiatives Week 2 Corporate Investment Decisions.

Strategic Information Initiatives Week 2 Corporate Investment Decisions.
2008 General Meeting Assemblée générale 2008 Toronto, Ontario 2008 General Meeting Assemblée générale 2008 Toronto, Ontario Canadian Institute of Actuaries.

2008 General Meeting Assemblée générale 2008 Toronto, Ontario 2008 General Meeting Assemblée générale 2008 Toronto, Ontario Canadian Institute of Actuaries.
RISK MANAGEMENT FOR INSURERS IN ISRAEL A Regulatory Perspective.

RISK MANAGEMENT FOR INSURERS IN ISRAEL A Regulatory Perspective.
B RITISH B ANKERS' A SSOCIATION Operational Risk & the Regulatory Environment Simon Hills Director - Prudential Capital team.

B RITISH B ANKERS' A SSOCIATION Operational Risk & the Regulatory Environment Simon Hills Director - Prudential Capital team.
Basel II and Emerging Markets The Future of Banking Regulation London School of Economics April 7–8, 2005 Gerd Häusler Counsellor and Director International.

Basel II and Emerging Markets The Future of Banking Regulation London School of Economics April 7–8, 2005 Gerd Häusler Counsellor and Director International.

Similar presentations

Ads by Google