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Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
Rulebook Modules
Prudential — Investment, Insurance Intermediation and Banking Module (PIB) [VER33/02-19]
Sourcebook Modules
Consultation Papers
Policy Statements
DFSA Codes of Practice
Amendments to Legislation
Media Releases
Financial Markets Tribunal

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  • PIB 6.3 Risk Identification and Assessment

    • PIB 6.3.1

      An Authorised FirmG must:

      (a) ensure that it identifies and assesses the Operational RisksG inherent in all the Authorised Firm'sG products, activities, processes and systems;
      (b) ensure the inherent risks in (a) are understood by relevant EmployeesG of the Authorised FirmG ;
      (c) systematically track Operational RiskG events and any financial impact associated with such events; and
      (d) ensure that the tracking in (c) is consistent with the Operational RiskG event types described in the Basel III framework.
      Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]

      • PIB 6.3.1 Guidance

        1. An Authorised FirmG should record all Operational RiskG events, including near misses and events which result in a positive financial outcome.
        2. These Rules complement related RulesG in GEN section 5.3 relating to risk management systems and controls. For example, GEN Rule 5.3.6 requires an Authorised FirmG to appoint an individual to advise its Governing BodyG and senior management as to risks.
        Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]

    • PIB 6.3.2

      An Authorised FirmG must ensure that its Operational RiskG policy in PIB Rule 6.2.1:

      (a) includes an approval process for all new products, activities, processes and systems; and
      (b) incorporates the requirement in PIB Rule 6.3.1(a).
      Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]

      • PIB 6.3.2 Guidance

        1. An Authorised FirmG should have policies and procedures that address the process for review and approval of new products, activities, processes and systems. The review and approval process should include consideration of:
        a. inherent risks in any new product, service, or activity;
        b. resulting changes to the Authorised Firm'sG Operational RiskG profile, appetite and tolerance, including changes to the risk of existing products or activities;
        c. necessary controls, risk management processes, and risk mitigation strategies;
        d. residual risk;
        e. changes to relevant risk limits;
        f. procedures and metrics to measure, monitor, and manage the risk of the new product or activity; and
        g. appropriate investment in human resources and technology infrastructure.
        2. Tools that an Authorised FirmG may employ for identifying and assessing Operational RiskG include:
        a. internal loss data collection and analysis;
        b. external data collection and analysis;
        c. risk assessments;
        d. business process mapping;
        e. risk and performance indicators; and
        f. scenario analysis.
        Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]