Documente Academic
Documente Profesional
Documente Cultură
Faisalabad
Aamir Raza
MBA-08-012
MBA (Finance)
University of Sargodha, Sargodha
REPORT ON
Presenting To;
Chief Manager
SBP (BSC) Bank Faisalabad
Basel Capital Accord
INTRODUCTION
HISTORY
EVOLUTION OF CAPITAL STANDARD
Introduction
WEAKNESS OF BASEL CAPITAL ACCORD
Created an incentive to take some highest quality assets off the balance sheet
Are as under;
To promote safety and soundness in the financial system
Reform credit risk weightings, making them more risk sensitive and in line with bank
practices
To cover all essential banking risks with theoretically grounded, flexible and operable
requirements which create incentives for advanced implementation
COMPARISON OF BASEL I AND BASEL II
Basel II
• Continue to promote safety
Minimum Capital Supervisory Review and soundness in the
Market Disclosure
Requirements Process banking system
• How is capital adequacy • How will supervisory • What and how should banks
measured particularly for bodies assess, monitor disclose to external parties?
Issue
Total Capital
= Capital Ratio (minimum 8%)
Advanced
Measurement Internal Modeling
Approach (AMA)
Standardized
Total Credit Approach
Regulatory Risk
Capital Capital Foundation
Internal Ratings
Based (IRB)
Advanced
Standard
Model
Market
Risk
Capital Internal
Model
CREDIT RISK – LINKAGES TO CREDIT PROCESS
16
OPERATIONAL RISK COMPONENT