Basel II & Basel III – Learning Roadmap

Play a word association game with Basel II and most bankers will return with Capital Adequacy. On the plus side, Basel II signaled a move away from a purely static regulator driven capital adequacy measure (Basel I) to an internal and relatively invasive assessment of the capital profile of a bank, called the Internal Capital Adequacy Assessment Process (ICAAP). On the downside, its implementation across many markets has been flawed due to a focus on Capital Adequacy and issues with review and approval of internal models.  But there is more to the debate around Basel II and Basel III than just Capital Adequacy and ICAAP.

Under ICAAP requirements a bank needs to have in place internal procedures and processes to ensure that it possesses adequate capital resources in the long term to cover all of its material risks and the board is kept cognizant of any expected or projected capital shortfall.

Basel III introduces significant reforms to the Basel II networks primarily by setting out the supervisory framework for liquidity risk measurement via two minimum funding liquidity standards.

Basel II & Basel III - Learning Roadmap - reforms

What are the prerequisites?

The history behind the current capital adequacy requirement framework

To understand the current capital adequacy requirement framework we begin with an overview of the historical background behind the development of Basel II and take a quick look at Risk, ALM and Bank regulation failure :

What topics are covered?

Basel II and ICAAP

The following courses then address Pillar 2 of the Basel II framework- the Internal Capital Adequacy Assessment Process (ICAAP):

Basel III

Basel III is due to be fully implemented by 2019 and represents reforms to and strengthening of the existing capital requirement and liquidity standards. The following courses, in turn, review the revisions to the Basel II framework that Basel III encompasses as well as a detailed review of the liquidity reforms.

What are the additional topics I can read up on?

Other courses related to Basel II, ICAAP and Basel III are:

Premium Content:

  1. ALM – Crash Course – 3rd Edition
  2. ALM – Crash Course – EXCEL Examples
  3. Basel III – Liquidity Framework
  4. Duration Convexity – EXCEL Example
  5. ICAAP Sample Report Template & Executive Summary
  6. ICAAP – Credit EXCEL Example
  7. ICAAP – Overview & Core Concepts
  8. Calculating VaR – Includes case study
  9. Calculating VaR – EXCEL
  10. Collateral Valuation in Credit Risk Management
  11. Setting Counterpart Limits
  12. Setting Limits – EXCEL Example
ALM Crash Course PDF & Excel package
Value at Risk - Training
Treasury Training

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