What is it about?
Given the financial crisis experienced by developed countries due to lax regulation, the research on operational risk management is pertinent. The study analyses the relationship between operational risk management (ORM), size, and ownership of Indian banks.
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Why is it important?
The study is important for Indian banks given the high level of losses due to bad loans, and the implementation of Basel III norms by the central bank, i.e. Reserve Bank of India. Further, due to high exposure of common man's savings in banks, the bank failure can have disastrous consequences for the Indian economy as the capacity of the Indian financial system to withstand such shocks is highly doubtful.
Perspectives
Given the severe implications which a bank failure can have on the Indian economy, where about 33% of household savings are deployed in deposits with commercial banks and other financial institutions, sharing insights on operational risk management is the need of the hour.
Dr Arunima Haldar
S.P. Jain Institute of Management and Research
Read the Original
This page is a summary of: Relationship between operational risk management, size, and ownership of Indian banks, Managerial Finance, October 2016, Emerald,
DOI: 10.1108/mf-05-2015-0145.
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