confidence - Investing In Africa

Management Discussions & AnalysisOperation Review (cont’d)An historical loss database, in line with the requirements of the Central Bank, has alsobeen built for the past three years to assess the risk areas of the Bank andappropriate insurance cover has been taken where considered necessary.The main sources of operational risks for the Bank are as follows:• Processing/internal controls risk• People risk• Regulatory/compliance risk• Legal risk• Technology risk• Reputational risk• Strategic riskProcesses and procedures are continuously updated with the introduction ofnew products, services and activities. Segregation of duties is in place betweenorigination, authorisation and execution of transactions to promote bettercontrols and appropriate levels of delegated authority are given to staff basedon capability and experience. An independent team of internal auditors carriesout sample checks to ensure adequacy and robustness of internal controlsaccording to a pre-agreed plan. Reports are submitted regularly to the AuditCommittee. The Internal Audit Team also liaises with the External Auditors andhas direct access to the Chairman of the Audit Committee/Board.86In line with the Central Bank requirements and local legislation, a Money LaunderingReporting Officer has been appointed to ensure that all identified suspicioustransactions are reported to the appropriate authorities. There is in addition anindependent team of Compliance Officers who carries out spot inspections to ensurethat regulatory requirements are met and internal procedures are being adhered to.Areas of non-compliance are reported to the Risk Committee.Given the complexities of some of the business transactions, training is anintegral part of the SBM culture so that staff are kept abreast of developmentsin their areas of operation. Quarterly appraisals are carried out to ensure thatperformance standards are met and corrective action taken where necessary.The Bank has also established a Code of Ethics and Business Conduct and aPolicy on Fit and Proper Person Criteria to ensure that staff with the appropriateskills and qualifications are selected for appropriate positions, avoidingsituations where potential conflicts of interest may arise.The Bank recognizes the internet as a tremendous enabler for improvedservice and communication with it customers. At the same time it is aware ofthe security/threats posed by the Internet, and constantly monitors newdevelopments in that area. In line therefore with its continued commitment to