Textual and cluster analysis of 10-K documents reveals three #riskculture classes linked to #riskstrategies, decisions, and recruitment. Firms with a strong risk culture show better #financialperformance and more diverse boards. #regulatory #supervision can help #insurers improve #risk behaviors.
"We show that past #operationalrisk losses are informative of future losses, even after controlling for a wide range of financial characteristics. We propose that the information provided by past losses results from their capturing hard-to-quantify factors such as the quality of operational risk controls, the #riskculture and the #riskappetite of the #bank."
"We use the recently failed #svb as a case study. Our [#machinelearning #textanalysis] findings indicate a weaker emphasis on #riskgovernance by SVB and an environment, particularly after 2011, where the #ceo became more dominant in influencing SVB’s #riskculture. We also show that despite recognition of the portfolio problems, SVB’s CEO’s tone indicated that #regulatorycompliance and #riskstrategy of the #bank would #mitigate these #risks. We observe an alignment between the #riskculture of SVB and other banks with the highest uninsured deposits as well as with two #us #gsibs."
"We show that past operational losses are informative of future losses, even after controlling for a wide range of financial characteristics. We propose that the information provided by past losses results from them capturing hard to quantify factors such as the quality of operational risk controls, the risk culture, and the risk appetite of the bank."
"This document explains the enterprise risk management framework in a flow chart form."
"This document is showing the flow chart of life insurance risk"