Risk
Identification
ØAfter establishing
the policy and setting required environment, within which the bank operates,
is the identification of individual risks. The comprehensive identification is
crucial for the overall risk management process, because a risk that is not
identified at this stage will not be included in further analysis.
ØSenior management
of the bank identifies and manages all
relevant risk across all business lines at the portfolio and daily operation
whatever the nature of the risk exposure (contractual or not, contingent or
not on or off- balance sheet). The objective of risk identification stage is
to produce a comprehensive list of risks and to assess them, narrowing the
list down to the top risks facing the organization.