---
entity_slug: bank_operational_risk
entity_type: Element
vsm_system: S3*
type_rationale: Bank Operational Risk is a persistent category of potential loss that
  exists as an inherent characteristic of banking institutions, making it a stock-like
  entity rather than a process or relationship.
vsm_rationale: As a risk category requiring monitoring, assessment, and management
  to ensure banking integrity and compliance with sound operational practices, it
  belongs to the audit function that inspects and maintains institutional standards.
classified_at: '2026-02-23T10:47:08.795858'
---

# Classification: Bank Operational Risk

## Entity Type

Element

## VSM System

S3*

## Type Rationale

Bank Operational Risk is a persistent category of potential loss that exists as an inherent characteristic of banking institutions, making it a stock-like entity rather than a process or relationship.

## VSM Rationale

As a risk category requiring monitoring, assessment, and management to ensure banking integrity and compliance with sound operational practices, it belongs to the audit function that inspects and maintains institutional standards.
