This lesson examines operational risk, which arises from human or technical problems, system failures, and external events . It covers the regulatory frameworks for operational risk in the US and UK financial markets .

• Definition of Operational Risk: Operational risk arises from human or technical problems and includes risks from system failures, human error, and external events . It differs from other types of financial risk in its sources and management approaches. The course covers how operational risk is actually handled in US and UK financial markets .

• Operational Risk Methodologies: Practical methodologies covered include Risk and Control Self Assessment (RCSA), the Basic Indicator Approach (BIA), and the Standardized Approach (SA), highlighting their role in quantifying and mitigating risk. The course advances to complex modeling techniques like the Advanced Measurement Approach (AMA) and categorization of real-world loss events .

• Operational Risk Frameworks: The course combines regulatory theory with applied examples and assessment tools, enabling learners to build both conceptual understanding and practical insight. By the end of this course, participants will be able to differentiate between risk approaches, evaluate risk control mechanisms, and apply operational risk frameworks within regulated financial environments .

• Skills and Applications: This course is especially useful for professionals interested in risk, banking, or financial operations. Learners report it helped them move from understanding concepts to actually planning operational risk management interventions . The terminology used aligns well with what is commonly seen in financial institutions .