HC-6.6.2
More specifically, the risk management framework generally encompasses the process of:
(a) developing and implementing the enterprise-wide risk governance framework, subject to the review and approval of the board, which includes the bank's risk culture, risk appetite and risk limits;
(b) identifying key risks to the bank including material individual, aggregate and emerging risks;
(c) assessing the key risks and measuring the bank's exposures to them;
(d) ongoing monitoring and assessing of the risk taking activities, decisions and risk exposures in line with the board-approved risk strategy, risk appetite, risk limits and determining the corresponding capital or liquidity needs (i.e. capital planning) on an ongoing basis;
(e) reporting to senior management, and the board or risk committee as appropriate, on all the items noted in this Paragraph including but not limited to proposing appropriate risk-mitigating actions;
(f) establishing an early warning or trigger system for breaches of the bank's risk appetite or limits; and
(g) influencing and, when necessary, challenging decisions that give rise to material risk.
Added: July 2018