Which of the Basel Accords, published in 2004, introduced operational risk as a risk subjected...

Introduction of Operational Risk in Basel Accords

Basel I (1988)→ Focusedonly on credit riskandmarket risk; operational risk wasnot yet included.

Basel II (2004)→ Introducedoperational risk as a separate category, subject tocapital requirements.

Basel III (2010)→ Strengthenedcapital and liquidity requirementsbut did not introduce operational risk.

Basel IV (2017, still evolving)→ Adjusts Basel III reforms but does not introduce operational risk as a new category.

Why Answer B is Correct

Basel II (2004) was the first to introduce operational risk as a risk requiring a capital charge.

Why Other Answers Are Incorrect

Option

Explanation

A. Basel I

Incorrect– Basel I focused oncredit risk and market risk, with no capital requirements for operational risk.

C. Basel III

Incorrect– Basel III strengthened Basel II but didnot introduce operational risk.

D. Basel IV

Incorrect– Basel IV refines Basel III but doesnot introduce operational risk as a new capital charge.

Basel II (2004) Operational Risk Framework

PRMIA Operational Risk Management Guidelines

PRMIA References for Verification