Project Risk Management for Banking Information Management System

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Name:
Course
Professor’s name
University name
City, State
Date of submission

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Introduction: Project Risk Management
This is a project risk management for a banking information management system for a local
bank.
Risk Assessment
1. Identification
This work should be carried out jointly and interactively: the customer with the performer. In
this regard, it is useful if the project of implementing an ERP system is preceded by a stage of
business diagnostics or the development of an IT strategy, since already in advance some of
the most important risks can be identified and taken into account (Bessis, 2015).
Risk management concepts in banks
For a bank, risk is the potential for loss of income or a decrease in the market value of a
bank’s capital due to the adverse effects of external or internal factors. Such losses can be
direct (loss of income or capital) or indirect (imposing restrictions on the ability to achieve
their business goals). These restrictions restrain the ability of the bank to carry out its current
activities or to use opportunities for business expansion. The risk identification process
occurred when the bank was changing its core management operation systems to a new
project. The people involved were the project managers, project team members and the bank
employees for checking how strong the system is and its risks identified (Burtonshaw-Gunn,
2017).
Among the large number of external risks can be identified five main groups:

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1. risk of force majeure - associated with the occurrence of unforeseen circumstances
that adversely affect the activities of the bank and / or its partners (natural disasters,
etc.);
2. country risk - associated with the possibility of adverse conditions for the bank in the
political, legal, economic sphere of the country in which the bank operates;
3. foreign policy risk - due to changes in international relations, as well as the political
situation in one of the countries that affect the activities of a bank or its partners
(wars, international scandals)
4. legal risk - associated with changes in legislation of different countries (Gambetta,
Zorio-Grima, and García-Benau, 2015).
5. Macroeconomic risk - arises due to adverse changes in the situation in individual
markets or the entire economic situation as a whole (economic crisis). Separately, it is
necessary to single out a component of macroeconomic risk - inflation risk associated
with the possible loss of the initial value of assets.
2. Analysis and Evaluation
Risk management decisions may include, in particular, risk avoidance: failure to accept it; its
minimization, including due to mitigating factors and / or transfer (transfer) of risk to other
persons (through derivatives or insurance), setting limits on bank exposure and other methods
of influencing the risk (risk carrier) or the level of bank vulnerability to it .Consider the
basics of the methodological foundations of risk analysis and management in the
implementation of the key stage of building an information system, a project to implement an
enterprise management information system (Larson,. and Gray, 2017).

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Risk
Severity
Matrix
S
e
v
e
r
I
t
y
Insignificant
Low
High
Catastrophic
Likelihood
Remot
e
Likel
y
Very
likel
y
Probabl
e
The severity matrix of the risk according to their likelihood of occurrence include;