EBA consults on RTS on operational risk management framework

The European Banking Authority (EBA) has launched a consultation on draft regulatory technical standards (RTS) specifying the operational risk management framework that institutions must have in place as set out in Article 323 of the Capital Requirements Regulation (CRR), as amended by CRR3. The draft RTS specify the three main components of the framework:

• Governance arrangements.
• The operational risk management process.
• The operational risk assessment system.

The draft RTS clarify the roles and responsibilities of the management body, senior management and the independent operational risk management function. They also set requirements for operational risk data and taxonomy, the business indicator component, reporting, validation and audit. Requirements relating to ICT risk are addressed through the Digital Operational Resilience Act (DORA).

Institutions with a business indicator below EUR 750 million will benefit from a lower frequency of reviews and reporting, a lesser level of granularity for their operational risk data, loss thresholds, and operational risk taxonomy. The deadline for comments is 31 December. The EBA will also hold a public hearing on 29 September (the deadline for registration for this is 25 September).

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