Risk Management - Public Bank | PBeBank.com
Risk Management - Public Bank | PBeBank.com
Risk Management - Public Bank | PBeBank.com
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Annual Report 2003<br />
www.publicbank.<strong>com</strong>.my<br />
CORPORATE GOVERNANCE<br />
<strong>Risk</strong> <strong>Management</strong><br />
Type of <strong>Risk</strong><br />
Operational <strong>Risk</strong><br />
<strong>Risk</strong> Control &<br />
Monitoring<br />
• Experienced key operational personnel appointed to the ORMC.<br />
• Business risk units are responsible for operating within the operational risk<br />
management framework.<br />
• Control and support units, which are independent of the business risk units, track<br />
risk levels to ensure business risk units operate within the established policies,<br />
procedures, limits and thresholds set for key risk indicators.<br />
• Comprehensive system of internal controls based on the principle of segregation of<br />
duties, independent checks, segmented system access control and multi-tier<br />
authorisation processes.<br />
• Systems and procedures to monitor transactions and positions.<br />
• Comprehensive and up-to-date documentation of processes and procedures.<br />
• Documented and regularly tested key back-up procedures and contingency plans,<br />
including disaster recovery and business resumption plans.<br />
• Overall assurance on the adequacy and reliability of the operational risk<br />
management systems by Internal Audit Division.<br />
• Post audit review and follow-up by Operations Control Department.<br />
Market <strong>Risk</strong><br />
<strong>Risk</strong> Identification &<br />
Measurement<br />
• Mark-to-market technique is used to revalue marketable securities, equities and<br />
foreign currency positions.<br />
<strong>Risk</strong> Control &<br />
Monitoring<br />
• Mark-to-market of trading positions are <strong>com</strong>pared against pre-determined market<br />
risk limits.<br />
• The market risk limits are set after taking into consideration the risk appetite of the<br />
<strong>Bank</strong>, and the risk-return relationship.<br />
• Trading positions and limits are regularly reported to management.<br />
Foreign Currency <strong>Risk</strong><br />
<strong>Risk</strong> Identification &<br />
Measurement<br />
• Mark-to-market of foreign exchange positions.<br />
• Review of foreign currency exchange exposure for overseas branches.<br />
<strong>Risk</strong> Control &<br />
Monitoring<br />
• Foreign exchange open positions are monitored against pre-determined position<br />
limits.<br />
• Mark-to-market valuations are monitored against pre-determined cut-loss limits and<br />
regularly reported to management.<br />
publicbank • 44
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