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(b) You are working as a Middle Level Executive with 'Mbazo Bank Ltd., The MIS Department has submitted the following Statistics from which you are

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(b) You are working as a Middle Level Executive with 'Mbazo Bank Ltd., The MIS Department has submitted the following Statistics from which you are required to calculate the Capital Charge for Operational Risk by Basic Indicator Approach. Year 31-03-2004 31-03-2005 31-03-2006 Gross Income 2600.00 3000.00 3400.00 Based on the Gross Income given above, calculate the Capital Charge for Mbazo Bank Ltd., as on March 31, 2007 to cover Operational Risk under Basic Indicator Approach. (5 Marks) (a) In its 2003 Sound Practices paper, the Basel Committee (in conjunction with the banking industry) identified seven loss event categories that are considered to have the potential to result in substantial operational losses. Discuss and give examples of these seven loss event categories. (20 Marks)

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