Operation Risk Management: Krungthai Bank Public Company Limited

Abstract

The purposes of this research were to study operation risk factors; to study operation risk incident; to study operational risk level; to study operational risk management systems of Krung Thai Bank (KTB); and to study plans to improve operational risk management of Krung Thai Bank (KTB). Conceptual framework was based on Committee of Sponsoring Organizations of the Treadway Commission Enterprise Risk Management (COSO ERM) and Basel Committee on Banking Supervision (BCBS). Purposive sampling technique was applied for qualitative research to select 6 employees of Krung Thai Bank (KTB) as informants for interview. Stratified random sampling technique was applied to select 700 employees of Krung Thai Bank (KTB) to answer self- reported questionnaires for quantitative research. Data were analyzed by ANOVA and multiple linear regression. Research findings revealed that important operational risk factors were caused by staff, working system, and violation of bank’s rules. Important operational risk incidents consisted of unfair actions against employees and riot from outside organization. Operational risk level of Krung Thai Bank (KTB) was at moderate level. Operational risk management system could statistically and significant help to prevent operational risk factors at a certain level. And development and improvement plan for operational risk management including building corporate culture and implementing operational risk management software.