Now the ongoing continuum of headline-grabbing operational risk incidents at banks, other financial institutions and even regulators continue to keep the issue of operational risk management at the top of agendas of CEO's , CRO's, Risk Managers and Internal & External Auditors alike.

These incidents are wide ranging and flow from issues like bank ATM collapses, bank operating system failures, regulatory settlements (fines) in the ongoing US sub-prime mortgage saga, rogue traders and the related risk managers who either missed or were will fully blind to all the warning signs.As the size and complexity of financial institutions has increased, so too have the challenges of understanding and reducing operational risks down to truly manageable levels.Increased regulatory concern and scrutiny have also increased the cost of operational risk events in the shape of outright financial loss, regulatory fines and declining customer confidence.

Risk Management masterclass will be an effective tool for not only maintaining but increasing, profits, shareholder value, public perceptions and goodwill. But, to achieve these gains, financial institutions must apply a consistent and comprehensive approach to managing their operational risks. They must also understand that this approach is fundamentally different from the approaches that they use in managing market, credit and liquidity risks.

"Bad Operational Risk Management has a severely negative effect on financial institutions in four very clear ways;

1. Actual operational risk losses are a direct hit to the income statement. Equally the massive fines being paid have the same effect.
2. The market punishes companies, via the stock price, for operational risk failures. This loss of value could well exceed the actual financial loss experience by the risk event in the first place.
3. Lowered Credit Ratings, which raises the institutions cost of borrowing money in the marketplace.