Basic Indicator Approach for Measuring Operational Risk Applied Research in Number of Private Banks

Abstract

Operational risk is an important topic for the banking sector that was presented by the Basel Committee on Banking Supervision within the framework of the Basel 2 Convention, which requires attention to that risk by setting capital requirements to face and hedge it, as many different approaches were used to measure this type of risk, including the entrance that was used in this research, which is the basic indicator method, as the study aims to identify operational risks and what are the mechanisms that can be used for the purpose of calculating them and the efficiency of banks in assessing risks, as the research was applied to a sample of banks listed in the stock market for the period (2016-2018) and for the purpose of achieving the objectives of the research, financial analysis was used to extract the results, and the research found the need for banks to adopt operational risk measurement entrances to achieve the basic requirements of capital to face those risks and allocate a reserve to face risks in general and operational risk specially.