Term  Definition                             Business risk The risk of reduced revenues due to an unexpected decline in income from ordinary business operations (most likely from a decline in business volumes caused by business cycles, price pressure or competition) or higher expenses.  Legal risk The risk that the bank is xposed to a changing legal environment or case law.  Operational risk The risk of loss resulting from inadequate or failed internal processes, people and systems or from external events (Basel Committee).  Reputational  risk  The risk of a negative deviation in the expected future economic outcome (missed future opportunity, foregone future revenues) from a deterioration in the banks image. A secondary  risk, caused by other (primary) risks.  Strategic risk The risk of a direct or indirect loss caused by faulty, unprepared or simply misjudged strategic decisions. This incorporates the risk of a loss due to an adverse or unfavourable economic business environment.