The Basel Committee on Banking Supervision consists of senior representatives of bank supervisory authorities and central banks from Argentina, Australia, Belgium, Brazil, Canada, China, France, Germany, Hong Kong SAR, India, Indonesia, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, Russia, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States.

It usually meets at the Bank for International Settlements (BIS) in Basel, Switzerland, where its permanent Secretariat is located.

The committee carried out some reforms after the Basel II Accord, with the objective of the reforming and improving the banking sector’s ability to absorb shocks arising from financial and economic stress, whatever the source, thus reducing the risk of spillover from the financial sector to the real economy.

This committee sets out the rules text and timelines to implement the Basel III framework. Through its reform package, the Committee also aims to improve risk management and governance as well as strengthen banks’ transparency and disclosures in what is known as the Pillar I, Pillar II and Pillar III of the Basel III Framework.

This 5 days course has therefore been designed to avail providers of banking services, local banking institutions and other financial institutions of the details of this reform and how to carry out its implementations as well as fulfilling the compliance regime contained in the reform

Learning Objectives
At the end of this training session, participants will be able to:

• Define banking regulation, describe the primary objectives of banking regulation, and list the key global regulators in the banking industry.
• Calculate the levels of regulatory capital a bank holds and determine if this exceeds the minimum amounts set out under Basel III.
• Familiarize yourselves with the relevant risks under the Basel III Regulation and how to manage such risks
• Identify the liquidity and leverage requirements of Basel III and determine if banks are above their specified minimum levels.
• Familiarize yourselves with other impactful regulatory frameworks that affect today’s banking industry.

Course Outline

Day 1

• Course overview
• Introduction
• Strengthening the global capital framework
• Building on the three pillars of the Basel II framework.
• Raising the quality, consistency and transparency of the capital base
• Enhancing risk coverage
• Supplementing the risk-based capital requirement with a leverage ratio
• Reducing pro-cyclicality and promoting countercyclical buffers
• Disclosures Regime and Hierarchy
• Disclosure
• Disclosure of Proprietary and confidential information
• Guiding principles of banks’ Pillar 3 disclosures
• Pillars of Basel III
• Basel III Minimum Capital Requirement
• Basel III after the crisis
• Strengthening the global capital framework
• Regulatory adjustments
• Capital conservation buffer
• Countercyclical buffer
• Leverage ratio
• Global liquidity standard
• Risk Coverage
• Calibration of the capital framework

Day 2

• Internal Capital Adequacy Assessment Process (ICAAP)
  Internal Liquidity Adequacy Assessment Process (ILAAP)
• Liquidity and Capital: A Vital Connection for Financial Institutions
• Key questions for banks
• Principles and steps of ICAAP and ILAAP
• Key risks that may be applicable to your institution
• Assessing ICAAP and ILAAP: Regulatory Guidelines
• Navigating Capital and Liquidity: A Perspective
• The Role of Stress Testing in Banking
• The key components of the ICAAP process are
• ILAAP Significance for Stakeholders and Regulators:
• Stress Testing for OLAR Compliance: Key Considerations
• Management Actions in Stress Scenarios

Day 3

• Risk-Weighted Asset Calculation
• What Are Risk-Weighted Assets
• Background information on Risk-Weighted Assets
• How to Assess Asset Risk
• Special Considerations
• What Is the RWA Ratio
• Risk-Weighted Asset Calculation Formula
• WRA Formula explained
• Example 1
• Example 2
• Advantages
• Disadvantages
• Market Risks (All about Trading Book and Banking Book)
• What Is a Trading Book?
• What Is a Banking Book?
• Market Risk Capital Rule
• Justification for the FRTB
• Basel III Minimum Capital Requirements for Market Risk (FRTB)

Day 4

• Credit Risks
• Definition
• Principles for the Assessment of Banks’ Management of Credit Risk
• Establishing an appropriate credit risk environment
• Operating under a sound credit granting process
• Maintaining an appropriate credit administration, measurement and
  monitoring process
• Ensuring adequate controls over credit risk
• The role of supervisors
• Common Sources of Major Credit Problems
• Concentrations
• Credit Process Issues
• Market and Liquidity-Sensitive Credit Exposures

Day 5

• Operational risk capital
• What is Operational Risk?
• Calculating the Operational Risk Capital
• Taking control of internal losses
• The future of operational risk management
• Advanced Measurement Approaches (AMA)
• General standards for using the AMA
• Qualitative standards for using the AMA
• Quantitative standards for using the AMA
• Detailed loss event type classification
• How operational risks differ from other types of risk
• Internal fraud
• External fraud
• Process management failures
• Employment and safety practices
• Technological failure
• Damage to physical assets
• Business practices
• Steps to Building an Operational Risk Management Program
• Risk identification
• Risk assessment
• Risk mitigation
• Risk monitoring
• The Continuous Journey of Minimizing Operational Risk
• Standardized approach in calculating operational risk capital
• Example of British Banks