Annual Report 2012 - National Savings Bank

129ASSESSING AND MANAGING OUR RISK FACTORSRISK MANAGEMENTMaturities of Assets and Liabilities (MAL) Rs.MillionsItemUp to1 month1 - 3months3 - 6months6 - 12months1 - 3years3 - 5yearsOver 5yearsAssetsCash on hand 446 - - - - - -Deposits with CBSL - - - - - - -Balances due from Other Banks 2,833 1,274 1,560 2,768 - - -Investments (Net of provisions) 16,135 21,012 33,841 80,943 122,324 40,626 23,887Loans and Advances 5,847 13,883 20,649 36,699 32,123 16,550 15,529NPLs - - - - - - 2,589Other Assets - - - - - - 5,250Other 2,993 5,323 2,513 1,351 307 34 636Total (a) 28,253 41,492 58,563 121,761 154,753 57,211 47,890LiabilitiesDeposits 74,802 148,596 60,265 128,536 27,965 360 1,619Borrowings 11,423 7,528 952 2,590 - - -Other Liabilities 3,406 3,569 3,996 4,109 3,859 55 375Total Capital Fund - - - - - - 25,919Total (b) 89,631 159,693 65,212 135,235 31,824 415 27,913Gap = (a) - (b) (61,378) (118,200) (6,650) (13,474) 122,930 56,796 19,977Cumulative Gap (61,378) (179,579) (186,228) (199,702) (76,773) (19,977) 0OPERATIONAL RISKThe Basel Committee on BankingSupervision denes operational riskas “the risk of loss resulting frominadequate or failed internal processes,people and systems or from externalevents”. This denition includeslegal risk but excludes strategic andreputational risk.The Regulators of nancial institutionsand banks are demanding a far greaterlevel of insight and awareness bydirectors about the risks they manage,and the effectiveness of the controlsthey have in place to mitigate theserisks. Further they have emphasisedthe importance of having a soundoperational risk management practicein place, especially when dealing withInternal Capital Adequacy AssessmentProcess (ICAAP).Operational Risk ManagementFrameworkThe Bank’s Operational RiskManagement framework provides amechanism for improving the overallNATIONAL SAVINGS BANK . ANNUAL REPORT 2012