Operational risk is the oldest kind of risk facing by banks, and it emerges in almost every aspect of the business environment. As financial scandals have appeared regularly, operational risk has been receiving increasingly significant media attention in recent years. This dissertation is written to identify the meaning of operational risk management and focus on the operational risk management situations in the UK banking sector by studying on four major British banks. Besides, Chinese banking industry is still in the process of reform, which would probably cause more operational failure for Chinese banks. Therefore, managing operational risk would be a crucial target for banks in China, and the aim of this dissertation is to give some helpful suggestions for them according to successful cases from the UK
