The Case Study - Seylan Bank

64Seylan Bank PLC Annual Report 2009The key mechanism in discharging the boardresponsibilities of risk management is throughthe Integrated Risk Management Committee thatcomprises the undermentioned three directorswith the participation of senior managementpersonnel. The Committee meets at least on aquarterly basis.The members of the Board Integrated RiskManagement Committee are:• Mr. Ajith Devasurendra - Director, Chairman ofthe Committee• Mr. Naomal Goonawardene - Director (Resignedw.e.f. 03/12/2009), Chairman of the Committee,till 3/12/2009• Mr. Lalith Withana - Director• Mr. Pradeepa Kariyawasam - DirectorFour meetings of the Risk ManagementCommittee were held during the year 2009.The responsibilities of the Integrated RiskManagement Committee are designed to capture awide range of potential risk-related issues that aredealt in a proactive and preventive manner. Some ofthe key functions include the following:• Taking prompt corrective actions to mitigateeffects of specific risks.• Reviewing and recommending Risk Managementpolicy, strategy and policy controls and systemsfor the Bank.• Establishing risk tolerance for the Bank atenterprise and strategic business unit levels.• Maintaining continued awareness of changesin the Bank’s risk profile and with periodicalreview of the risk exposures of the Bank.• Submission of risk assessment reportsto the board pursuant to the discussionsand observations at the Risk ManagementCommittee meetings.The new board places a very high emphasis onthe risk management function and strengthenedthe committees as well as the organisationalframework. Further, the effectiveness of thecommittees is being elaborated on, rather thanmere functioning for the sake of formality. Thestructures of information dissemination andreporting formats have been improved.A board approved Risk Management Policycovering multifaceted aspects has been put in place.A new Risk Management Department enhancingthe former Risk Management Department withwider scope and functions is set up to concentrateon the risk management function as a second line ofdefence for the Bank’s Integrated Risk Managementsystem. This Department will coordinate the activitiesof risk management and submit quarterly reports tothe Integrated Risk Management Committee. Thesereports include risk identification, risk measurement,reporting on risk-based occurrences, trends in therisks undertaken, risk mitigation and control. TheRisk Management Department will also maintaindata relating to operational loss events for furtherevaluation and study.