Managing Risk for Better Business

Risk Management Standards help business

Continual advancements in financial technology present increased operational risk, changing the way organizations must deal with risk management issues. Financial organizations must contend with capital requirements and new risk management standards.

How BPM Can Help: Business Process Management (BPM) solutions provide the tracking, measurement and streamlining capabilities to fulfill your compliance mandates and improve your overall operational risk management.

The Interfacing Technologies Advantage: Our Enterprise Process Center™ (EPC) BPM software product allows for the systematic improvement of transparency and accountability across departmental boundaries, for superior operational risk and compliance management.

The issue of operational risk

With every advance a new risk is born. Risk is inherent in evolution and in business. Continual advancements in financial technology and the globalization of financial services have created a number of new risks for financial organizations – primarily falling under the category of operational risk. Operational risk is generally regarded as the risk of loss resulting from

• insufficient or failed internal processes,
• people and systems,
• external events.

What is Basel II

Basel II, or The New Accord (based on the original Basel Accord), was created to improve the way financial organizations and regulators approach risk management worldwide. It’s goal is to revise the international standards for measuring capital, and to introduce a more formal approach to measuring and managing operational risk. It is based on three pillars:

• Minimum capital requirements
• Supervisory review
• Market discipline

Basel II asks organizations to implement a corporate risk management system that accounts for operational risks. As of 2007, Basel II will require financial organizations to set aside regulatory capital for operational risk – an important development that affects most financial service institutions worldwide.

What does Basel II Mean for You?

As the 2007 Basel II deadline for implementation nears, banks and other financial institutions are focusing on the implications and the necessity for comprehensive risk management process and compliance strategy. From a Business Process Management(BPM) perspective, the standards of Basel II have increased pressure on:

• tracking capital adequacy,
• measuring and maximizing profitability,
• streamlining systems which, due to acquisitions and mergers, may not cooperate within the same organization.

A clearBusiness Process Management (BPM) framework will allow you to easily design processes and develop the strategic measurement necessary to ensure proper performance and reduce operational risk across your organization.

Enterprise Process Center(EPC) software

Interfacing Technologies’ Enterprise Process Center™ (EPC) software package allows you to effectively manage operational risk by clarifying accountability and ownership of processes, providing superior process knowledge across departmental boundaries, and standardizing processes to meet compliance with your corporate and regulatory policies.

Furthermore, with its dynamic benefits, EPC will optimize your overall risk and compliance management and operational efficiency – now and for the future, as compliance issues evolve and become more complex.

The Enterprise Process Center™ (EPC) – A turnkey compliance solution

In addition to meeting Basel II requirements and all other standards for risk management, EPC offers versatile profitability analysis, fully integrated performance measurement and better planning capabilities.

When used to manage issues associated with Basel II, Interfacing Technologies’ Enterprise Process Center™ (EPC) BPM software product offers a competitive advantage that goes beyond compliance standards to provide the following advantages: