Risk Management is a discipline at the core of every
financial institution and encompasses all the activities that affect its risk
profile. It involves identification, measurement, monitoring and controlling
risks to ensure that:
a) The individuals who take or manage risks clearly
understand
it.
b) The organization’s Risk exposure is within the
limits.
c) Risk taking decisions are in line with the business
strategy
and
objectives.
d) The expected payoffs compensate for the risks
taken.
e) Risk taking decisions are explicit and clear.