The Great Financial Crisis created many challenges for financial institutions and regulators alike. The implementation of the Basel III Risk-Based Capital Standards was intended to address the risks that were inadequately addressed by the Basel II regime. Now “Basel III Endgame” is on the table to address some of the challenges arising from Basel III!
This one-day seminar provides a concise but in-depth overview of the key components of the Basel III framework that have been implemented, as well as those proposed by the Basel III Endgamerequirements. This includes specific exercises which reinforce the various methodologies used to calculate capital and credit loss provision requirements under this regulatory regime. In addition to the regulatory requirements, practical considerations to facilitate the implementation of an appropriate risk management program will be discussed to ensure that the delegates will be able to translate the information from the seminar into action items in their institutions.
Course Objectives
By the end of the course, participants will be able to:
- Discuss Basel I, II and III
- Discuss current regulatory capital rules including:
- Risk-based capital (RBC) requirements
- Leverage ratio and supplemental leverage ratios (SLR)
- Stress capital buffer (SCB)/Comprehensive capital analysis and review (CCAR)
- Capital conservation buffer (CCB)
- Countercyclical Capital Buffer (CCyB)
- Explain the variability in risk weighted assets (RWA) across banks
- Analyze components of the Basel III endgame
- Credit risk capital
- Market risk capital
- Operational risk capital
- Credit Valuation Adjustment (CVA)
- Analyze the differences between internal and standardized approaches
- Discuss how the Fundamental Review of the Trading Book (FRTB) will impact capital levels
- Identify and discuss Basel III principles for sound stress testing practices and supervision
Suggested Prerequisites:
- Fundamentals of Capital Markets/Securities Industry
- General understanding of banking or equivalent knowledge
Program Level:Foundational-Intermediate
Advance Preparation: None
Computers and Financial Calculators: N/A
Recommended CPE Credits: 7