The current #canadian regime, which draws on the #basel #operationalrisk framework, is not equipped to handle the unique challenges of #cyberrisk. Cyber incidents differ from traditional operational disruptions in terms of their dynamism and impact, and traditional risk-based #supervision is not suitable for the rapidly changing cyber profile of #regulated #financialinstitutions.services for all communities, especially those most impacted by climate change."
"... banks with robust pre-crisis regulatory capital ratios are less risky (have a lower insolvency risky) relative to less-capitalised banks amid the crisis period. This suggests that the post 2007-09 Basel reforms have succeeded, to some extent, in strengthening the risk-resilience of banks during the Covid-19 economic fallout."
"... some operational risk managers are working more closely with their human resources partners to develop a more cohesive approach to people risk management. In the context of current reforms to the capital requirements for operational risk"
"These parameters can be calibrated using public data. This new approach means not only to evaluate climate risks without picking any specific scenario but also allows to fill the gap between current one year approach of regulatory and economic capital models and the necessarily long-term view of climate risks by designing a framework to evaluate the resulting credit loss on each step (typically yearly) of the transition path. This new approach could prove instrumental in the 2022 context of central banks weighing the pros and cons of a climate capital charge."
"As a result of a regulatory focus on quantitative capital requirements, it also finds management of people risk subsumed by this regulatory approach, and evidence that the ‘embedded’ nature of people risk has hindered the development of a more comprehensive industry-wide approach to people risk management."
"...we argue that... the median shortfall—that is, the median of the tail loss distribution—is a better option than the expected shortfall for setting the Basel Accords capital requirements due to statistical and economic considerations such as capturing tail risk, robustness, elicitability, backtesting, and surplus invariance."