Operational Risk – Risk Profile

Operational Risk Losses by Event Type (Profit and Loss view)

in € m.

Dec 31, 2013

Dec 31, 2012

Clients, Products and Business Practices

2,384

1,989

Internal Fraud

970

861

External Fraud

(69)

28

Execution, Delivery and Process Management

53

54

Others

32

19

Group

3,370

2,951

Profit and loss based operational losses increased by € 420 million or 14 % compared to year-end 2012. The increase was dominated by event types “Clients, Products and Business Practices” and “Internal Fraud” due to reached settlements and increased litigation reserves for unsettled cases. The decrease in “External Fraud” is predominately caused by a gain from a direct recovery. Event type “Execution, Delivery and Process Management” is stable and the other event types increased slightly.

Operational Losses by Event Type occurred in the period 2009-2013 (2008-2012)(1)

Operational Losses by Event Type occurred in the period 2009-2013 (2008-2012) (pie chart)

The above left pie chart “Frequency of Operational Losses” summarizes operational risk events which occurred in the five-year period 2009-2013, based on the period in which a loss was first recognized for that event. For example, for a loss event that was first recognized in 2002 with an additional profit/loss event recognized in 2013, the frequency chart would not include the loss event while the loss distribution chart would include the profit/loss recognized in the respective period. Frequencies are dominated by the event type “External Fraud” with a frequency of 63 % of all observed loss events. The event types “Execution, Delivery and Process Management” contribute with 25 % and “Clients, Product and Business Practices” with 10%. Others are stable at 2 %. The event type “Internal Fraud” has a low frequency, resulting in 0.3 % of the loss events in the period 2009-2013 and is unchanged compared to 2008-2012.

The above right pie chart “Distribution of Operational Losses” summarizes operational risk loss postings recognized in the profit/loss in the five-year period 2009-2013. The event type “Clients, Product and Business Practices” dominates the operational loss distribution with a share of 65 % and is determined by outflows related to litigation, investigations and enforcement actions. “Internal Fraud” has the second highest share of 22 % which is related to the regulatory matters we have experienced in recent years. Finally event types “External Fraud” with 8 % and “Execution, Delivery and Process Management” with 4 % are minor compared to the other event types.


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