Bank of India－印度同行的案子.pptVIP

Basel II – A New Global Banking Paradigm 20 February 2004 Risk management has emerged as a key area of focus for banks in recent times especially due to Basel II accord The Basel Committee recommendations urge banks to adopt more risk sensitive approaches to Risk Management… Overview of the New Basel Capital Accord Credit Risk Measurement Approaches under Pillar I  Credit Risk Measurement Approaches under Pillar I (contd..) Operational Risk Measurement Approaches under Pillar I Basel II intends to a simulate a convergence of regulatory driven riskmanagement towards economic driven risk management Basel II regime is expected to enable Banks to reduce their regulatory capital by using advanced advanced risk management approaches Operational risk is inherent to banking business and not received adequate attention in past Strategic implications on Banking sector Challenges in Basel II implementation Bharat S Raut Co. Bharat S Raut Co. Project Finance Retail Equity Sovereign Bank Corporate External Factors People Internal Process Commodity Equity Foreign Exchange Interest Rate – in banking and trading books Security and Integrity Risk Systems Risk Operational Risk Credit Risk Types of Risks Market Risk Information Risk Advanced methods for capital allocation Capital charge for operational risk Focus on internal capabilities Supervisors to review banks internal assessment and strategies Focus on disclosure Portfolio of approaches “One size Fits All” More Risk Sensitive Broad Brush New Accord Old Accord The new Basel Accord is based on Three Pillars Minimum Capital Supervisory Review Market Discipline …and has proposed a challenging implementation deadline of 2006 for internationally active banks Market risk Unchanged from existing Basel Accord Credit risk Significant change from existing Basel Accord Three different approaches to the calculation of minimum capital requirements Capital incentives to move to more sophisticated credit risk manageme