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PRMIA 8010 Exam Syllabus Topics:
| Section | Objectives |
|---|---|
| Measurement and Quantification | - Key risk indicators (KRIs) - Loss distribution approaches |
| Risk Governance and Frameworks | - Three lines of defense model - Risk governance structures and accountability |
| Risk Identification and Assessment | - Scenario analysis and risk mapping - Risk and control self-assessment (RCSA) |
| Regulatory and Industry Standards | - Regulatory expectations for operational risk management - Basel operational risk frameworks |
| Operational Risk Fundamentals | - Risk taxonomy and loss event types - Definition and scope of operational risk - Operational risk within enterprise risk management |
| Mitigation and Control | - Internal controls and control testing - Risk transfer mechanisms including insurance |
PRMIA Operational Risk Manager (ORM) Sample Questions:
1. Which of the following are valid methods for selecting an appropriate model from the model space for severity estimation:
I. Cross-validation method
II. Bootstrap method
III. Complexity penalty method
IV. Maximum likelihood estimation method
A) I and IV
B) I, II and III
C) All of the above
D) II and III
2. Which of the following are valid approaches to calculating potential future exposure (PFE) forcounterparty risk:
I. Add a percentage of the notional to the mark-to-market value
II. Monte Carlo simulation
III. Maximum Likelihood Estimation
IV. Parametric Estimation
A) All of the able
B) I and II
C) III and IV
D) I, III and IV
3. Which of the following credit risk models focuses on default alone and ignores credit migration when assessing credit risk?
A) The actuarial approach
B) The contingent claims approach
C) CreditPortfolio View
D) The CreditMetrics approach
4. Which of the following are valid approaches to leveraging external loss data for modeling operational risks:
I. Both internal and external losses can be fitted with distributions,and a weighted average approach using these distributions is relied upon for capital calculations.
II. External loss data is used to inform scenario modeling.
III. External loss data is combined with internal loss data points, and distributions fitted to the combined data set.
IV. External loss data is used to replace internal loss data points to create a higher quality data set to fit distributions.
A) I, II and III
B) All of the above
C) II and IV
D) I and III
5. Which of the following statements are true:
I. Heavy tailed parametricdistributions are a good choice for severity modeling in operational risk.
II. Heavy tailed body-tail distributions are a good choice for severity modeling in operational risk.
III. Log-likelihood is a means to estimate parameters for a distribution.
IV. Body-tail distributions allow modeling small losses differently from large ones.
A) I and IV
B) All of the above
C) II and III
D) II, III and IV
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: B | Question # 3 Answer: A | Question # 4 Answer: A | Question # 5 Answer: B |




