EBI Publications

Conclusion: Enterprise Risk Management helps organizations and banks in getting to their goals and objectives avoiding any pitfalls and surprises along the way through applying a continuous journey of risk convergence. The convergence focuses on developing a common risk language, framework, identifying risk areas, sharing data, specifying roles and responsibilities and creating a shared technological system of data to support the entire process. In addition, it requires the contribution from each department in the bank to face the different underlying challenges. A successful ERM process would ensure that risk taken by bank is well compensated and the bank is completely aware of the amount of risk that it wants to take over. In this sense, an integrated ERM model helps in delivering tangible benefits in terms of costs reduction, compliance achievements and complete awareness of the risk profile faced by the bank. focus of implementation. In the light of the above, the main challenges addressed by banks in the ERM adaption are: x Identifying roles/ responsibilities. x Establishing common risk language. x Describing the risk appetite. x Establishing risk committee and/or Chief Risk officer to coordinate activities. x Establishing ownership for particular risks and responses x Developing and monitoring action plans x Developing consolidated reporting x Demonstrating the cost- benefit of ERM .

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