Financial Risk Manager Part 2
Get started today
Ultimate access to all questions.
In the context of operational risk types, as elaborated by the senior risk consultant during the discussion, which of the following operational losses should Bank JKY classify under the Execution, Delivery, and Process Management category?
In the context of operational risk types, as elaborated by the senior risk consultant during the discussion, which of the following operational losses should Bank JKY classify under the Execution, Delivery, and Process Management category?
Exam-Like
Explanation:
The correct answer is B. This loss was caused by an error in transaction capture, which is classified as an operational loss in the Execution, Delivery and Process Management category. The other options are incorrect for the following reasons:
- Option A is an operational risk in the Clients, Products and Business Practices classification related to disputes over performance of advisory activities.
- Option C is a loss in the Internal Fraud category.
- Option D is an example of a credit risk loss for Bank JKY, even though it resulted from an operational risk event at the counterparty. Also, monetary loss due to a cyber-attack should be classified by the client in the External Fraud category.