Basel II and III

Basel is a universally accepted set of measures developed by the Basel Committee on Banking Supervision because of the financial situation of 2007 to enhance understanding of key supervisory issues and quality improvement of banking supervision worldwide. It sets out a framework that covers areas such as capital adequacy, stress testing market liquidity risks, etc.

This three-day course provides participants with a comprehensive overview of Basel capital and liquidity regulations for banks and financial institutions. This is an interactive course, where real-life examples, case studies, and exercises are used to illustrate key learning points to enable participants to apply the concepts delivered throughout the course.

Training Objectives:

• develop a thorough understanding and detailed knowledge of the Basel framework (II and III)
• define hands-on strategies and techniques for the definition, measurement, analysis, improvement, and control of operational risk within a banking organization
• templates for computations

Pre-requisite

• Good understanding of Ms. Excel
• Good understanding of the guidance of IFRS 9

Methodology

• Instructor guided presentation
• Case studies
• Discussion session
• Scenario and Case study sessions

What to Expect

• Expert facilitation
• Souvenirs (classroom option)
• Tea break and Lunch (classroom option)
• Discussion session
• Practical Examples
• Certificate

Course Outline

• Introduction and overview
  • Regulatory Background
  • The Three Pillars
  • History
  • Scope of Application
• Principles of Basel Accord
  • Capital Requirement
  • Leverage Ratio
  • Liquidity Requirements
• Minimum Capital Requirement
  • Definition of Regulatory Capital
  • Risk-Weighted Asset:
    • Credit Risk
    • Market Risk
    • Operational Risk
• Credit Risk
  • Expected Credit Loss and IFRS 9:
    • The three stages
    • Calculating probability of default
    • Calculating loss given default
    • Calculating exposure at default
• Pillar I: Minimum Capital Requirement
  • Credit Risk-Weighted Asset:
    • Model Approach:
      • Standardized approach
      • Internal Risk-Based (IRB) approach
    • Credit Mitigation
      • Simple approach
      • Comprehensive approach
  • Operational Risk-Weighted Asset:
    • Basic indicator approach
    • Standard approach
  • Market Risk:
    • Standard approach
      • Specific risk
      • General risk
    • Internal approach
• Leverage Ratio
• Liquidity Coverage:
  • High-Quality Liquid Assets (HQLA)
  • Net Cashflow
• Supervisory Review Process
• Disclosure Requirement
• Central Bank Regulations