Risk assessment methodology in general has been around for quite a while, its prominence in the E-banking field is a fairly recent phenomenon. We are at the point where risk assessments are critical to the overall function of banks. Banks are required to assess the processes underlying their operations against potential threats, vulnerabilities, and their potential impact, which helps in revealing the risk exposure level, and the residual risks. Identifying clearly a risk assessment methodology is often the first step of assessing and evaluating risk associated with an organization operation. This paper presents a risk assessment methodology for Ebanking Operational Risk. The proposed risk assessment methodology consists of four major steps: a risk model, assessment approach, analysis approach and a risk assessment process. The main tool of the proposed risk assessment methodology is the risk assessment process. The assessment process gives detailed explanation with respect to which models or techniques may be applied and how they are expressed. In this paper the risk assessment technique is built upon fuzzy logic (FL) concept and Bayesian network (BN). In fuzzy logic, an element is included with a degree of membership. Bayesian network is an inference classifier that is capable of representing conditional independencies. The Bayesian and fuzzy logic–based risk assessment process gives good predictions for risk learning and inference in the E-banking systems.
Keywords: Fuzzy logic, Bayesian network, risk assessment methodology, operational risk, Ebanking
Applications of Fuzzy Logic in Risk Assessment - The RA_X Case
