South African Journal of Economic and Management Sciences
On-line version ISSN 1015-8812
DE JONGH, Erika; DE JONGH, Dawie; DE JONGH, Riaan and VAN VUUREN, Gary. A review of operational risk in banks and its role in the financial crisis. S. Afr. j. econ. manag. sci. [online]. 2013, vol.16, n.4, pp. 364-382. ISSN 1015-8812.
The role of operational risk in the 2007/2008 financial crisis is explored. The factors that gave rise to the crisis are examined and it is found that although the event is largely regarded as a credit crisis, operational risk factors played a significant role in fuelling its duration and severity. It is concluded that, from an operational risk perspective, 2008 was the worst on record. Considering the extensive role of operational risk in global financial calamities, suggestions are made to improve the management of this risk type.
Keywords : operational risk; banks; credit crisis.