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Starling Bank
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=== '''Risk assessment of the industry''' === Starling bank defines risk as any unexpected future event that could damage their ability to achieve strategic, financial or overall business objectives, including damage to earnings capacity, capital positioning, business reputation, cash flows, or poor customer outcomes. The following are the important risks that have been identified: * '''Operational risk''' - the risk of loss, whether direct or indirect, to which the bank is exposed due to insufficient or failed internal processes. They encompass the following sub-categories: ** Internal fraud; ** People; ** Customers, Products & Business Practises; ** Legal; ** Outsourcing and third parties Starling has a suite of operational risk policies in which they go over the identification, management and reporting of the risks associated with the identified sub-categories of operational risk. * '''Credit risk''' - the risk of financial loss to a consumer's failure to repay a loan or failure to follow contractual obligations. The bank has corresponding strategies for the different credit risk types in order to manage them. The bank is exposed to Retail & Commercial Credit Risk, and Wholesale Credit Risk: ** Retail and Commercial Credit Risk - this is the current or prospective risk of a customer of the bank not following their contractual obligations. This risk is associated with the lending facilities which Starling offers to its Mortgage, SME and retail customers. ** Wholesale credit risk - this arises from balance sheet management and investments in highly rated debt securities which are included within the High Quality liquid Asset portfolio. Starling does not try to heavily depend on any wholesale party to an extent in which a failure by that party would have a severe impact on the bank. Starling mitigates wholesale credit risk by operating within a limit framework set by the board. * '''Liquidity Risk Management''' - this is the risk that starling, over a specific horizon, will become unstable to settle obligations when due. The primary causes of liquidity and funding risk for Starling are customer funding risk, in which the customer deposits balances fall, and the risk that Starling's liabilities do not grow as planned while assets grow faster than the business pla
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