Calculating Reputation Risk of Financial Institutions

Tomer Kedarya, Rafael Sherbu Cohen, Amir Elalouf

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

Abstract

The reputation risk is one of significant risks affecting reliability and credibility of commercial banks. It is one of the main assets Financials Institution have to calculate and keep it safe. It's a smooth slope, once your reputation is damaged, it has a direct and indirect impact on the organization income, profit and your financial strength. This subject is relatively new and the current literature deals with the need to manage the risk of reputation, identifies factors which are difficult to estimate and usually without any action plan. According to The Basel Committee on Banking Supervision [1], banks failed to recognize the reputational risks associated with their off-balance sheet vehicles, securitization schemes, overall liquidity positions, and business practices [4]. Our contribution is the mathematical analysis of the probability and effect of reputation risk's factors. This article will focus on the way to calculate Reputation Risk in Risk Assets terms and its influence on the Capital Adequacy Ratio.

Original languageEnglish
Title of host publication7th International Conference on Control, Decision and Information Technologies, CoDIT 2020
PublisherInstitute of Electrical and Electronics Engineers Inc.
Pages1174-1178
Number of pages5
ISBN (Electronic)9781728159539
DOIs
StatePublished - 29 Jun 2020
Event7th International Conference on Control, Decision and Information Technologies, CoDIT 2020 - Prague, Czech Republic
Duration: 29 Jun 20202 Jul 2020

Publication series

Name7th International Conference on Control, Decision and Information Technologies, CoDIT 2020

Conference

Conference7th International Conference on Control, Decision and Information Technologies, CoDIT 2020
Country/TerritoryCzech Republic
CityPrague
Period29/06/202/07/20

Bibliographical note

Publisher Copyright:
© 2020 IEEE.

Keywords

  • COVID-19
  • Reputation
  • Reputation risk
  • Reputation risk calculation

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