Certified Basel Professional Training Course

Why select this training course?

Basel is the leading international regulatory standard on various bank capital stress testing, availability, and market liquidity risks. It was created to develop banking regulatory and supervisory guidelines for banks by the central bank governors of ten countries as a response to the disturbance in international currency and the market in general (the failure of Bankhaus Herstatt, Germany). It was established with the major aim of improving financial stability and increasing banking quality of supervision. It majorly handles banking supervisory matters.

Understanding this committee’s set guidelines and frameworks will put the professionals ahead in the banking market and enable them to make informed decisions that could be otherwise hard to make. It will also give them the knowledge of how bank capital requirements are strengthened by improving the banks’ liquidity and lowering the bank’s leverage.

The Basel Committee has created three major publications that seek to lay the required foundation and international cooperation on banking supervision. The publications cover supervisory powers, supervisory actions, compliance with supervisory standards, and the need for early intervention in supervision. The latest publication, Basel II, offers a management tool for prevailing risk factors with the issuance. It was done in the same period as the failure of Lehman Brothers. And a few months later, there was a framework to strengthen the Basel II capital framework. The first publication that contains 29 principles is also known as Basel I or the Basel capital accord; it laid the necessary foundations for the supervision of internationally active banks. Basel II, or the new capital framework, was issued to propose new capital adequacy policies to replace the capital accord. It is comprised of three important pillars. When the 2007 – 2009 crisis hit, there was a response publication called Basel II. It is not so unique from Basel I and II, but it requires different levels of capital reserves to meet different forms of deposits and other borrowing activities

Why was the Basel Committee formed?

The Basel Committee on Banking Supervision (BCBS) was formed in 1974 by the central bank governors of the Group of Ten (G-10) countries. The main purpose of the BCBS is to promote international cooperation and coordination in banking supervision and regulation.

What does the Basel committee do?

• Developing and promoting the adoption of international banking standards and principles
• Providing a forum for central banks and supervisors to exchange information and share best practices
• Conducting regular assessments of the implementation of its standards and principles

Understanding how these documents are used and their effects are crucial for anyone in the banking and market sector. The Certified Basel Professional Training Course by Rcademy will detail the crucial contents of this document. The complex and continuous Basel landscape can be difficult to keep up with; this Rcademy course keeps track of all the changes that have been made and presents them to the participants in a simple yet powerful way that fosters an easy understanding of complex principles and guidelines.

Who should attend?

The Certified Basel Professional Training Course by Rcademy is ideal for the following professionals:

• Rating Agency Analysts
• Board Members That Have Risk Responsibilities
• Portfolio Managers
• Legal, Compliance, and IT Support Officers
• Cros And the Heads of Risk Management
• Credit And Equity Analysts

What are the course objectives?

The Certified Basel Professional Training Course by Rcademy aims at enabling professionals:

• Fully understand the roles of the Basel Committee thoroughly
• Discover and define hands-on strategies used to manage risk in banks
• Apply the knowledge learned to improve the risk assessment process
• Understand how risk is controlled in banks
• Understand how to perform effective analysis on potential compliance issues

How will this course be presented?

All Rcademy courses are designed, prepared, and presented by experts with vast experience in teaching and their field of dominance. The course will be presented using the following methods:

• Lecture notes
• Videos
• Group discussions
• Case studies
• Exercise

What are the topics covered in this course?

Module 1: Introduction to Basel III

• The Basel III publication
• What was the role of Basel II in creating Basel II?
• Introduction to the amendments
• The FSB (financial stability board)
• Interactions between the Basel III framework and the G20

Module 2: Quality of Capital

• Tier 2 capital
• Limits and minima
• Double gearing
• Common equity tier 1
• Investments held as proxies
• Securitization and securitization

Module 3: Basel II and How it Influences Basel III

• Overview
• Application
• Standardized approach
• Market risks
• Market discipline
• Specific issues
• Data maintenance and testing
• Validation
• Quantification of IRB systems and maturity
• Control and oversight mechanism
• IRB system overview
• Market internal risks model approach
• Why it needed improvement

Module 4: Basel I and How it Influences Basel III

• Terrorist financing
• Open-source intelligence
• Visualizing cases and flows of money
• Suspicious transactions report
• Mutual legal assistance
• Why it needed improvements

Module 5: Global Liquidity Standards

• Introductions
• Total net cash outflows
• Available stable funding (ASF)
• The stock of high-quality liquid assets
• Market-related monitoring tools
• Required stable funding (RSF)
• Available unencumbered assets
• Liquidity Coverage Ratio (LCR)
• Transitional arrangements
• Contractual maturity mismatch
• LCR by significant currency

Module 6: Countercyclical Capital Buffer

• Home/host challenges
• Procyclical/countercyclical
• Objectives
• Risk of misleading signals
• Other macroprudential tools
• Common reference guide
• The Role of Judgment
• Treatment of surplus when buffer returns to zero
• National authorities’ guidance on operating countercyclical buffer

Module 7: SIFIs (Systemically Important Financial Institutions)

• Improvements to resolution regimes
• Stronger robustness standards
• Peer review
• Strengthening SIFI and supervision
• More intensive supervisory oversight
• SIFIs and G-SIFIs
• The European systemic risk board
• Developments at the national and regional levels
• Additional loss absorption capacity
• The financial stability oversight council

Module 8: Stress Testing

• Stress testing
• Fifteen stress testing principles used in banks
• Stress testing principles for supervisors
• Principles for stress testing practices

Module 9: The SIMIs (Systemically Important Markets and Infrastructures)

• Systemic risk capture in Banks risk models
• Risk modeling, stress testing, and analysis
• The central clearing and trade reporting on OTC derivatives
• Need for a strong stress testing program
• The capture of systemic risk/tail events in risk modeling
• The normality assumption
• Counterparty credit exposures

Module 10: Leverage Ratio and Capital Conservation

• Enforcing capital conservation discipline
• Calculation of the leverage ratio
• Distribution policies
• Simple, non-risk-based leverage ratio
• Sound capital conservation
• Off-balance sheet leverage
• Enhance risk coverage
• Calibrations