Under this framework, the assessment
of an institution is built on a thorough understanding
of the institution, its activities, risk management
processes and operating environment. The key stages
in the risk assessment process are:
- Determining the significant activities
undertaken by an institution.
- Assessing the inherent risks
and adequacy of corresponding risk management systems
and internalcontrols for each of these activities.
- Assessing the financial strength
of the institution and the adequacy of the Board and
senior management oversight of its businesses.
- Determining the overall risk
rating for the institution, and consequently the supervisory
The new risk assessment framework
improves the consistency and robustness of MAS' risk
assessment process, and in turn leads to more effective
use of our supervisory resources.