A: Basel II is the updated version of international bank capital accord (Basel I) which are recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision.
The goal of Basel II is to create an international standard that banking regulators can use when creating regulations about how much capital banks need to put aside to guard against financial and operational risks.
This is accomplished with rigorous risk and capital management requirements set in place to ensure that the greater risk to which the bank is exposed, the greater the amount of capital the bank needs to hold in order to safeguard its solvency and overall economic stability.
A: The three pillars of Basel II are as follows:
- Maintenance of regulatory capital calculated for three major components of risk that a bank faces:
- credit risk
- operational risk
- market risk
- Provides a framework for the other / residual risk banks may face, such as:
- systemic risk
- pension risk
- concentration risk
- strategic risk
- reputation risk
- liquidity risk
- legal risk
- Increases the disclosures that the bank must make. The purpose is to allow the market to have the full picture of the bankÔÇÖs overall risk position. This allows counterparties of the bank to deal and price accordingly.
A: Basel II applies to banking and financial organizations.
A:The Basel II compliance software allows you to:
- Perform risk and control self assessments (RCSA)
- Document and track KRIs (Key Risk Indicators)
- Correlate each risk to the relevant Basel and/or BBA Risk Categories
- Calculate VaR using Loss Distribution Approach (LDA) for computing capital charges
- Accumulate external loss data
- Document and manage internal loss events
- Perform business impact analysis using scenarios
- Qualify and quantify inherent and residual risk
- Aggregate and drill down on risk status across multiple dimensions using dynamic dashboards
- Generate pre-defined or customizable reports
- Run simulations
- Manage workflow and remediation action plans, ensure follow-through, automate alerts and escalations
- Comprehensively document business and IT processes
A: easy2complyÔÇÖs Basel II compliance software is an affordable, reliable and easy-to-deploy software solution with intuitive and effective operational risk management based on Basel II Pillar I and Pillar 2 that integrates the operational risk management silos.
easy2comply can be deployed either on-demand (SaaS) or on-site to suit your preferred configuration. We serve customers in many markets including: financial institutions, telecom, energy, and government, pharmaceutical, healthcare and commercial organizations.
