Analyses of the causes contributing to the financial market crisis pointed out that current capital requirements partly created inappropriate incentives. Several adjustments were made in recent years to eliminate the deficiencies identified. The adoption and publication of the regulations known as “Basel III” in late 2010 constitute the culmination of the amendment efforts at present. They will be phased in from 1 January 2013 and will raise considerable challenges for banks (see figure).
The new rules on capital adequacy relate to a fundamental modification of the capital definition, the introduction of a non-risk-based maximum leverage ratio, new regulations for securitisations in the banking and the trading book as well as adjustments to the calculation of counterparty credit exposures. Requirements forliquidity risk are raised by introducing new liquidity measures and monitoring tools. The results of the Quantitative Impact Study 2010 (QIS 2010) clearly highlight that banks need to take actions across all areas of the Basel III regulations both at the European and the international levels.
zeb/ provides you with competent advice on all current regulatory developments, points out the consequences for your methods, processes and IT systems and supports you in implementing the required adjustments. Moreover, we are the ideal partner for all issues related to the approval of internal models by supervisory authorities.
Our services:
- Support in the implementation of the Basel III challenges:
- Gap analysis and implementation planning
- Impact analyses and scenario calculations (e.g. QIS surveys)
- Implementation of the new requirements — in functional, technical and process terms
- Integration of the new requirements into bank-wide management and management reporting
- Switch from the aggregation and deduction method (Commercial Code) for calculating own funds to the method based on consolidated accounts (IFRS taking account of the German Consolidated Financial Statements Reconciliation Regulation (KonÜV))
- Preparation of and assistance during the approval procedure for internal counterparty, market and operational risk models:
- Gap analysis and profitability calculations
- Preparation of application documents
- Design and validation of models
- Design and implementation of kernel and reporting solutions
- Model roll-out for international bank groups
- Support during cross-border approval procedures and during on-site reviews
- Monitoring of international and national developments, proposals and legislative initiatives taking account of national discretions