Building for Basel

The 2005 implementation date for the new Basel II Accord – already postponed by a year – is looming large. Whilst the banking sector is steadily gearing up for the proposed changes, there are fears that some institutions may be left behind. Sara-Louise Boyes investigates.

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2005 MAY SEEM A LONG WAY OFF, but next month banks will have to start work on their Basel II implementation strategy if they are to avoid falling behind. Preparing for a set of as-yet largely undefined provisions may seem tantamount to building a house on sand. Nonetheless, it is essential that banks lay firm foundations – setting up data collection and models, choosing a ratings-based approach from the three on offer, and checking that their IT systems are up to the task.

In 1988 the Basel

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Credit risk & modelling – Special report 2021

This Risk special report provides an insight on the challenges facing banks in measuring and mitigating credit risk in the current environment, and the strategies they are deploying to adapt to a more stringent regulatory approach.

The wild world of credit models

The Covid-19 pandemic has induced a kind of schizophrenia in loan-loss models. When the pandemic hit, banks overprovisioned for credit losses on the assumption that the economy would head south. But when government stimulus packages put wads of cash in…

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