The Basel Committee on Banking Supervision has issued the paper "Recognising the risk-mitigating impact of insurance in operational risk modelling". The paper discusses potential benefits and shortcomings of banks' use of insurance to mitigate operational risk.
The regulatory capital framework permits banks, subject to certain criteria and limitations, to use insurance to mitigate the operational risk capital charge under the advanced measurement approach (AMA). The implementation of this provision has raised some challenges and technical questions. In response, the report clarifies supervisory expectations on the range of industry AMA practices while promoting increased convergence in operational risk management.
© BIS - Bank for International Settlements
Documents associated with this article
|
|
Recognising.pdf
|
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article