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Risk management

RISK MANAGEMENT FRAMEWORK Risk is defined as potential losses or foregone profits that can be triggered by internal and external factors. Therefore, the objectives of risk management are identification of potential risks in our operations and transactions, in our assets, liabilities, income, cost and off–balance sheet exposures and independent measurement and assessment of such risks and taking timely and adequate measures to manage and mitigate such risks within a risk-return framework. In DBBL, only calculated risks are taken while conducting banking business to strike a balance between risk and return. Risk is clearly identified, mitigated or minimized and if possible eliminated to protect capital and to maximize value for shareholders. It is also ensured that on balance sheet and off-balance sheet risks taken by the Bank are consistent with risk appetite and strategic objectives of the Bank. A wide range of tools and techniques are used to address & mitigate all kinds of inherent and potential risks in banking operations. The Bank attaches highest priority to establish, maintain and upgrade risk management infrastructure, systems and procedures. In this regard, sufficient resources are allocated to improve skills and expertise of relevant banking professionals to manage the risk effectively. The policies and procedures are approved by the Board and assessed on a regular basis to bring these to the level of satisfaction required to manage & mitigate the risks adequately and consistently. Ultimate responsibility for effective risk management lies with the Board of Directors of DBBL. The Board and its committees like Audit Committee and Executive Committee, set principles and limits, review and monitor various risks to assess adequacy of system and to ensure that the Bank is operating within approved systems & procedures. Management committees, like ALCO and Credit Committee, also oversee and ensure that sufficient risk management systems are in...