Basel 3 PPT Official
Basel 3 PPT Official
Basel 3 PPT Official
OVERVIEW
Aims
Objectives
Major Changes
Regulation
Supervision
Risk management
Reasons for Basel III Formulation:
revised risks:
Credit risk
Operational risk
Market risk
Pillar 1:Minimum Capital
Requirements(cont.)
Credit risk
The standardised approach
Foundation internal ratings based (IRB)
approach
Advanced IRB approach
Operational risk
Basic indicator approach
Standardized approach
Advanced measurement approach
Market risk
standardized approach
internal models approach
Pillar 2:Supervisory Review
Process
Pillar 2 requires banks to think about the whole spectrum
of risks they might face including those not captured at all
in Pillar 1 such as interest rate risk.
Coverage in Pillar 2:
risks that are not fully covered by Pillar 1
Credit concentration risk
Counterparty credit risk
Risks that are not covered by Pillar 1
Interest rate risk in the banking book
Liquidity risk
Business risk
Stress testing
Pillar 3:Market Discipline
Pro-cyclicality.
Liquidity risk.
Systemic banks.
Basel III: Strengthening the global capital
framework
A. Capital reform.
B. Liquidity standards.
capital.
Contingent capital.