2013 Annual Report
RISK MANAGEMENT
RISK MANAGEMENT
The Operational Risk Structure - The structure
is comprised by the Operational Risk Office, which
includes areas such as Operational and Technological
Risk, Information Security, Intelligence and Prevention
of Fraud and Occurrences.
SAS Room (Alternative Site Santander), contingency office used
to ensure business continuity.
The model adopted by the Bank includes two approaches:
qualitative and quantitative.
Qualitative approach: This approach aims at the
identification and prevention of operational risk; the
definition of the risk profile for areas, processes and
products, implement tools and key indicators for qualitative
operational risk (KRIS) while strengthening the environment
for internal controls.
Quantitative approach: helps detect and capture
operational risk events while analyzing, correcting and
preventing events. In addition, it provides mechanisms
and inputs for the decision-making process.
Thus, the Model for the Operational Risk Control and
Management provides an adequate environment for
internal controls while supporting mechanisms and tools
that help prevent operational errors and losses, thereby
ensuring business continuity.
Improved security in electronic
channels (ATMs, Customer
Service and Internet Banking)
resulted in a drop in losses and
client complaints
RISK MANAGEMENT: BY THE BANK,
FOR THE BANK G4-2
Risk management is a two-way street: its purposes are both
minimizing risk that external factors may bring to the Bank's business
and managing the impacts that the Bank's activity may bring to the
society and environment.
The main direct risk generated by the banking activity is inadequate
loan concession or use, which may generate over-indebtedness,
especially in households. The main indirect risk involves any impacts
caused by projects and firms that the Bank may agree to finance.
In order to manage such risks, the Bank adopted a set of legal,
voluntary practices such as credit limits considering the income
and repayment capacity; financial education practices; and social
and environmental risk analysis in financing projects to large sized
companies (see more on page 45).
As to financial education, the main line of activity is in the relationship
between management and clients. To that effect, the Bank invests
strongly in training and development with the participation of
30,000 employees in 2013.
Other initiatives supplemented this effort such as Santander Responde
(financial education videos on the institutional portal and Youtube
and a Q&A platform on Facebook); the Portal de Sustentabilidade
(videos, brochures and worksheets in financial education);
Caminhos&Escolhas (a portal that attracts young people who are
interested in working in the financial market with online games and
courses); and lectures in partner universities and communities served by
the microcredit facility.
"
THE MAIN EXPOSURE RISKS FOR THE
BANK ARE: CREDIT RISK, MARKET
RISK, SOCIAL AND ENVIRONMENTAL
RISK AND OPERATIONAL RISK.
IN 2013 THE LOAN NPL RATIOS
DROPPED EVEN IN A SCENARIO
WITH MILD ECONOMIC ACTIVITY
AND HIGHER BENCHMARK INTEREST
RATES IN THE COUNTRY.
SANTANDER IS A PIONEER IN THE
SOCIAL AND ENVIRONMENTAL RISK
AREA IN BRAZIL.
74%
OF THE GOAL FOR SOCIAL AND
ENVIRONMENTAL RISK TRAINING
PROGRAM WAS ATTAINED
48 Annual Report 2013
For additional information on direct environmental impact caused by the Bank activities please read the
Environmental Management chapter.
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