• OM-B OM-B General guidance and best practice

    • OM-B.1 OM-B.1 Guidance provided by other international bodies

      • OM-B.1.1

        The papers below provide guidance which promotes best practice and can be generally applied by all licensees to their activities.

      • Basel Committee: Framework for Internal Controls Systems in Banking Organisations

        • OM-B.1.2

          The paper (see www.bis.org/publ/bcbs40.pdf) issued in September 1998 presents the first internationally accepted framework for supervisors to use in evaluating the effectiveness of the internal controls over all on- and off-balance-sheet activities of banking organizations.

        • OM-B.1.3

          The paper describes elements that are essential to a sound internal control system, recommends principles that supervisors can apply in evaluating such systems, and discusses the role of bank supervisors and external auditors in this assessment process.

      • Basel Committee: Sound Practices for the Management and Supervision of Operational Risk

        • OM-B.1.4

          The paper (see www.bis.org/publ/bcbs96.pdf) issued in February 2003 by the Risk Management Group of the Basel Committee on Banking Supervision, outlines a set of principles that provide a framework for the effective management and supervision of operational risk, for use by banks and supervisory authorities when evaluating operational risk management policies and practices.

        • OM-B.1.5

          The paper also recognises that clear strategies and oversight by the Board of Directors and senior management, a strong operational risk culture and internal control culture (including, among other things, clear lines of responsibility and segregation of duties), effective internal reporting, and contingency planning are all crucial elements of an effective operational risk management framework for banks of any size and scope.

      • Basel Committee: Risk Management for Electronic Banking and Electronic Money Activities

        • OM-B.1.6

          The paper (see www.bis.org/publ/bcbs35.pdf) issued in March 1998 provides guidelines for supervisory authorities and banking organisations as they develop methods for identifying, assessing, managing and controlling the risks associated with electronic banking and electronic money.

        • OM-B.1.7

          The paper indicates that, while providing new opportunities for banks, electronic banking and electronic money activities carry risks as well as benefits and it is important that these risks are recognised and managed in a prudent manner.

      • Basel Committee: Risk Management Principles for Electronic Banking

        • OM-B.1.8

          The paper (see www.bis.org/publ/bcbs98.pdf) issued in July 2003 recognizes new risks associated with the increase in distribution of financial services through electronic channels, or e-banking. To emphasize the importance of these risks, the Committee has placed responsibility on the shoulders of the Board and senior management to ensure their institutions have analysed, identified and modified operations to mitigate these risks.

        • OM-B.1.9

          To facilitate these developments, the Committee has identified fourteen Risk Management Principles for Electronic Banking to help banking institutions expand their existing risk oversight policies and processes to cover their e-banking activities.

        • OM-B.1.10

          The Risk Management Principles fall into three broad, and often overlapping, categories of issues that are grouped to provide clarity: Board and Management Oversight; Security Controls; and Legal and Reputational Risk Management.