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Financial Innovation

Table 2 Parameters estimation and KS test results of loss frequency distributions

From: Operational risk assessment of third-party payment platforms: a case study of China

Loss part

Distribution

Parameter value

D-value

P value

HFLI losses

NBD

\(r = 2.42\)

\(p = {0}{\text{.22}}\)

0.13

0.90

PD

\(\lambda = 8.78\)

–

0.33

0.03

LFHI losses

PD

\(\lambda = 2.11\)

–

0.21

0.34

  1. The values \(r,p\) and \(\lambda\) are parameters of NBD and PD respectively.
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