Research on affecting factors of operational risk management for commercial bank based on structural equation model

  • Li Jun Liang*
  • , Fan Chen Meng
  • , Li Jie Cao
  • *Corresponding author for this work

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

    Abstract

    Structural equation model (SEM) was employed to analyze the interaction factors that affecting operational risk management (ORM) from questionnaires for commercial banks in the research. Based on lots of international and Chinese documentation and questionnaire, the model was constructed with 20 affecting factors and 4 layers (bank employee, section & sub-branch, head office & branch office and bank conditions). "Bank employee level" is taken as the endogenous latent variable, and other levels are taken as the exogenous latent variables from the research results. According to the modification indices (MI) of the model and the modification corresponding criterion, the model was modified so as to get optimized model. The main innovation includes two parts, one is to design the questionnaire for ORM to get important information, and the other one is to employ SEM to analyze ORM factors.

    Original languageEnglish
    Title of host publicationProceedings of 2012 International Conference on Machine Learning and Cybernetics, ICMLC 2012
    Pages679-687
    Number of pages9
    DOIs
    Publication statusPublished - 2012
    Event2012 International Conference on Machine Learning and Cybernetics, ICMLC 2012 - Xian, Shaanxi, China
    Duration: 15 Jul 201217 Jul 2012

    Publication series

    NameProceedings - International Conference on Machine Learning and Cybernetics
    Volume2
    ISSN (Print)2160-133X
    ISSN (Electronic)2160-1348

    Conference

    Conference2012 International Conference on Machine Learning and Cybernetics, ICMLC 2012
    Country/TerritoryChina
    CityXian, Shaanxi
    Period15/07/1217/07/12

    Keywords

    • Affecting factors
    • Commercial banks
    • Operational risk management (ORM)
    • Structural equation model (SEM)

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