medium · FRM Part 2 Operational Risk
Under the 'Standardized Measurement Approach' (SMA) for operational risk, which of the following actions would lead to an immediate, mechanical reduction in a bank's Pillar 1 capital requirement?
- Purchasing a comprehensive cyber insurance policy with a $100 million limit.
- Updating the RCSA scores from 'Amber' to 'Green' across all divisions.
- Implementing a new automated fraud detection system that cuts small loss frequency by 50%.
- Divesting a business unit that generates significant fee income.
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