Multi-criteria Decision-Making on Operational Risk in Banks

DOI

10.2991/978-94-6463-110-4_2How to use a DOI?

Keywords

Bank Risk Management; MCDM; BWM method

Abstract

The frequency of application of different multi-criteria decision-making methods in business and financial problems is justified by the diversity and complexity of business decisions. The methods enable analysts and decision-makers to assess when making a decision. This research aims to present the contribution of multi-valued relationship methods in assessing operational risks in banks operating in Serbia. The article shows that the multi-criteria approach used in the initial phase of identifying operational risk increases the potential of bank management for further risk management, particularly in operational risk management (ORM). The research also included a comparative analysis of the results obtained by various MCDM methods, which were more concerned with business risk analysis. An example of a decision-making problem in operational risk management is presented, showing how the issue of decision-making in operational risk management is structured using the BWM method. The use of the BWM method proved to be highly acceptable for decision-makers in banks compared to other models. In all MCDM models, external factors and human resources rank first. The results unequivocally indicated the significant influence of external factors on banking operations – the consequences of the COVID-19 pandemic, part-time work, hacker attacks, economic policy, and adjustment of the economy to epidemiological restrictions. The approach is simple and provides an effective method that can be successful in solving other decision-making problems.

Copyright

© 2023 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Vladimir Ristanović
AU  - Goranka Knežević
PY  - 2023
DA  - 2023/01/30
TI  - Multi-criteria Decision-Making on Operational Risk in Banks
BT  - Proceedings of the 1st International Conference on Innovation in Information Technology and Business (ICIITB 2022)
PB  - Atlantis Press
SP  - 5
EP  - 21
SN  - 2352-538X
UR  - https://doi.org/10.2991/978-94-6463-110-4_2
DO  - 10.2991/978-94-6463-110-4_2
ID  - Ristanović2023
ER  -