Chase Cooper’s unique aCCelerate Capital enables users to model and quantify the capital charge for operational risk management.
aCCelerate Capital uses Monte Carlo simulation to calculate the capital charge based on existing internal loss data, available external loss data, and Business Environment and Internal Control Factors (BEICFs) contained in the risk and control assessment (RCA), as well as using scenario analysis data. Compliant with regulatory requirements, the model has been validated independently by expert led actuaries.
The BEICFs and scenarios are modelled in aCCelerate Scenarios and the output from aCCelerate Scenarios can be transferred into aCCelerate Capital to combine with internal and external loss data, in any desired weights. Economic, as well as regulatory, operational risk capital can be computed in aCCelerate Capital at any user specified quantile using Monte Carlo simulation. In addition, aCCelerate Capital has the ability to take into account any correlation between business lines and between loss event types.
Key features of aCCelerate Capital
- ICAAP compliant operational risk capital charge calculation model
- Highly flexible combination of internal losses, external losses, BEICFs and scenarios at any desired individual weights
- Availability of the commonly used probability distributions for modelling loss frequency and severity
- Easy-to-use “What If” facility enables changes to parameters that directly affect capital
- Ability to specify any correlation between user-set business lines and between user-set loss event types
- User friendly interface and simple calibration
- Transparent model design, process and methodology
- Standalone models or can be linked with the aCCelerate GRC suite
- Extensive training and methodology support from Chase Cooper
Key benefits of aCCelerate Capital
- Facilitates the direct comparisons of regulatory and economic capital charges across multiple user-set business lines and user-set loss event types
- Enables the application of historical and prospective scenario analysis to examine the impact on capital allocation
- Allows the measurement of various business lines’ performance based on capital allocation
- Assists risk managers in understanding capital allocation and communicating with internal and external stakeholders
- Reflects capital requirements for current business environments as well as future plausible outlook
- Provides valuable information for business planning and strategic decision making
- Aligns fully with the organisation’s operational risk management framework and supports enterprise wide operational risk management