,RSK4801 Assignment 2 (COMPLETE
ANSWERS) Semester 1 2025 – DUE July 2025;
100% correct solutions and explanations.
Operational Risk Management Report: Region Bank Case
Study (2021)
RSK4801 Assignment Response
Introduction
Operational risk management has gained prominence in the
banking industry, especially after global disruptions such as
the COVID-19 pandemic and the rise of environmental,
technological, and regulatory pressures. The Region Bank, like
many financial institutions, operates in a highly regulated
environment and faces multiple internal and external risks
that must be effectively managed and reported. The purpose
of this report is to analyse the operational risk framework of
Region Bank for the 2021 reporting year and address key
aspects of its risk management process.
This response will discuss the benefits of a sound operational
risk report, identify operational risk factors and allocate the
specific risks identified in the case study, explain the Risk and
Control Self-Assessment (RCSA) process and its benefits, and
describe the three lines of defence model, which underpins
the Bank’s governance structure.
, Question 1: Benefits of a Sound Operational Risk Report (10
Marks)
A sound operational risk report provides significant value to a
financial institution. The main benefits include:
1. Enhanced Decision-Making:
Reliable and consistent risk data helps senior
management and the board make informed strategic and
operational decisions (Basel Committee, 2011).
2. Regulatory Compliance:
The report ensures adherence to regulatory and statutory
requirements, avoiding penalties and reputational
damage.
3. Proactive Risk Mitigation:
By identifying high-frequency and high-severity risks, the
Bank can implement timely corrective actions.
4. Transparency and Accountability:
Regular risk reporting fosters a culture of accountability,
where risk owners are responsible for managing and
mitigating risks.
5. Stakeholder Confidence:
Stakeholders, including investors and regulators, gain
ANSWERS) Semester 1 2025 – DUE July 2025;
100% correct solutions and explanations.
Operational Risk Management Report: Region Bank Case
Study (2021)
RSK4801 Assignment Response
Introduction
Operational risk management has gained prominence in the
banking industry, especially after global disruptions such as
the COVID-19 pandemic and the rise of environmental,
technological, and regulatory pressures. The Region Bank, like
many financial institutions, operates in a highly regulated
environment and faces multiple internal and external risks
that must be effectively managed and reported. The purpose
of this report is to analyse the operational risk framework of
Region Bank for the 2021 reporting year and address key
aspects of its risk management process.
This response will discuss the benefits of a sound operational
risk report, identify operational risk factors and allocate the
specific risks identified in the case study, explain the Risk and
Control Self-Assessment (RCSA) process and its benefits, and
describe the three lines of defence model, which underpins
the Bank’s governance structure.
, Question 1: Benefits of a Sound Operational Risk Report (10
Marks)
A sound operational risk report provides significant value to a
financial institution. The main benefits include:
1. Enhanced Decision-Making:
Reliable and consistent risk data helps senior
management and the board make informed strategic and
operational decisions (Basel Committee, 2011).
2. Regulatory Compliance:
The report ensures adherence to regulatory and statutory
requirements, avoiding penalties and reputational
damage.
3. Proactive Risk Mitigation:
By identifying high-frequency and high-severity risks, the
Bank can implement timely corrective actions.
4. Transparency and Accountability:
Regular risk reporting fosters a culture of accountability,
where risk owners are responsible for managing and
mitigating risks.
5. Stakeholder Confidence:
Stakeholders, including investors and regulators, gain
