Page 86 - Capricorn IAR 2020

GOVERNANCE REPORT RISK REPORT REMUNERATION REPORT
Operations risk This is the risk of failure to deliver the intended outcome regarding facilities, data, processes, business continuity, physical cash management and payment management. Losses due to payment errors or theft as a result of poor
physical security are examples of this risk.
How we mitigate this risk
The low levels of operational risk losses in the banking subsidiaries continue due to deliberate efforts to reduce losses from errors and the Group-wide implementation of Risk Culture building and risk training.
Operations risk is managed according to the standardised approach to operational risk management under Basel II. Qualitative and quantitative tools are applied to identify and assess operations risks.
Key risk indicators
• Loss and error events
• Losses
• Successful completion of integrated recovery tests
PRIORITIES FOR 2020 AND PROGRESS MADE
• Business continuity plans were reviewed, and business impact analysis improved
• By 30 June 2020, all but one entity fully implemented the Business Continuity Framework
• The control environments for payments, cash management and physical security were improved
• The turnaround time on the vehicle and asset finance process for branches was improved
• The process of opening a savings and current account was significantly improved, including by
beginning to issue instant cards
GOVERNANCE OVERSIGHT
We submit monthly risk reports to risk committees. A quarterly risk report is compiled from the subsidiary information and reported to the Group risk committee and BARC.
FUTURE FOCUS AREAS
• Data quality and process optimisation
• Implementingthe branch of the future
• Improveprocesses using Six Sigma to remove variation and ensure clients experience consistent high-quality services
• Implementmeasures to improve our capacity to minimise and absorb losses related to COVID-19
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