An Assessment on The Effectiveness of Operational Risk Management among Tanzanian Financial Institutions:” The Case Study of Selected Banks in Dar es Salaam

Masenene, Fatuma A. (2015) An Assessment on The Effectiveness of Operational Risk Management among Tanzanian Financial Institutions:” The Case Study of Selected Banks in Dar es Salaam. Masters thesis, The Open University Of Tanzania.

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Abstract

The study was done to assess the effectiveness of operational risk management among the financial institutions in Tanzania whereby five banks in Dar es Salaam were selected as a sample. The study had drawn 84 respondents randomly from the chosen five banks in the region, whereby the conclusions were generalized to all the banks in Tanzania. The sample was investigated using questionnaires and interview. It was found that operational risks policies, procedures and instruments are there in financial banks though to some extent they are not effectively managed. Also methods used to manage operational risks were not well implemented. Awareness of bankers on principles guiding operational risks was found to be minimal among them. The results revealed that most of the respondents proved that operation risk management in Tanzanian financial institutions were found not well implemented. The study concluded that there were a lot of weaknesses in management of DOR including lack of strong risk management departments, weak rules and principles, unimplemented policies and biasness in the implementation of compensation. The study recommended a need for strong risk control departments, training and availability of insurance that are active in organizations. It is lastly suggesting areas for further studies to focus and asses the contribution of Tanzanian financial organizations to the developments of their employees and to examine the effects of adopting the automated technologies among the banks in Tanzania.

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