Talking Risk

Chapter 6

Sure. For example, the Bank is required to publish its Balance Sheet by a certain time each month.

I hope is not another fete because you can’t take on anything else!

I want to raise something that has been on my mind.

Yes, but the Bank only has control over completing it and sending it out on time to the media houses for publishing.

So the risk would be that it may not be published on time.

No it’s not … at least not that I know of. This thing about something not assessed as a risk if the Bank has no control over it. Explain that some more.

So let’s say it went out on time, but it’s election time, the politics hot, so it didn’t get a space in the paper. That ain’t the Bank fault.

So you’re saying just concern ourselves with what’s happening inside the Bank?

I would prefer to say - focus on the risks that we have control over. If the risk response is outside of our control then it is not a risk for us to manage.

Or it could be that the music fest ads full up the paper.

Exactly, so late publishing is not one of the Bank’s risk. We only have control over the risks related to timely completion and dissemination to the media houses.

And

if

the

Well that ain’t the same thing I just said? You just put it in your fancy way.

Not quite - let me try and help. The ECCB regulates commercial banks even though their operations are outside the ECCB. The BSD is assigned to manage the risk of a commercial bank failure.

So if commercial banks decide to give big loans to all they big friend who they know can’t pay back and then have problems, the ECCB must manage that? you saying

What I’m saying is that the BSD manages the risk of a commercial bank failing by identifying any problem areas and implementing measures to have them addressed.

commercial bank decide they going do they thing anyway? ECCB must take the blame for that?