 Credit & Risk Analyst (S.O. Post) in a Public Sector Bank.

 7 years Banking experience.

 Selected as SBI PO and also cracked IBPS PO.
 Appeared in UPSC Civil Services Mains (2017).
Academics:
 Chartered Financial Analyst (C.F.A.)
 Masters in Commerce (Accounting & Business Statistics).
 Diploma in Treasury, Investment & Risk Management.
 JAIIB & CAIIB.

Follow me on Unacademy:
https: //unacademy.com/user/Zinni
 Basel Committee on Banking Supervision
 This is a committee of banking supervisory authorities that was established by
the central bank governors of the Group of Ten countries in 1974.
 The Committee's Secretariat is located at the Bank for International Settlements
(BIS) in Basel Switzerland
 The Basel Committee formulates broad supervisory standards and guidelines and
recommends statements of best practice in banking supervision worldwide.
 The BIS and the Basel Committee are two distinct entities.
 The Committee's members come from Argentina, Australia, Belgium, Brazil,
Canada, China, European Union, France, Germany, Hong Kong SAR, India,
Indonesia, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, Russia, Saudi
Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, the United
Kingdom and the United States.
 BASEL-III
Basel III is a comprehensive set of reform measures developed by the Basel
Committee on Banking Supervision to strengthen the regulation, supervision
and risk of the banking sector. It has been implemented starting on January 1,
2013 and fully phased in by January 1, 2019. Basel III is intended to
strengthen bank capital requirements by increasing bank liquidity and
decreasing bank leverage.
The Basel III reform measures aim to:
 Improve the banking sector's ability to absorb shocks arising from financial
and economic stress.
 Improve risk management and governance.
 Strengthen banks' transparency and disclosures.
 Capital Adequacy Ratio
• The Capital Adequacy Ratio (CAR) is a measure of a bank's capital. It is
expressed as a percentage of a bank's risk weighted credit exposures.

• Also known as capital-to-risk weighted assets ratio (CRAR), it is used to

protect depositors and promote the stability and efficiency of financial
systems around the world. Two types of capital are measured: Tier -1
capital, which can absorb losses without a bank being required to cease
trading, and Tier-2 capital, which can absorb losses in the event of a
winding-up and so provides a lesser degree of protection to depositors.
CAR= Tier 1 capital + Tier 2 capital
Risk Weighted Assets
 Pillars of BASEL
• The first pillar Minimum Capital Requirement is mainly for total risk
including the credit risk, market risk as well as Operational Risk.
• The second pillar i.e. Supervisory Review Process is basically intended to
ensure that the banks have adequate capital to support all the risks
associated in their businesses. In India , the RBI has issued the guidelines to
the banks that they should have an internal supervisory process which is
called ICAAP or Internal Capital Adequacy Assessment Process. With this tool
the banks can assess the capital adequacy in relation to their risk profiles as
well as adopt strategies for maintaining the capital levels.
• Third Pillar: Market Discipline The idea of the third pillar is to complement
the first and second pillar. This is basically a discipline followed by the bank
such as disclosing its capital structure, tier-I and Tier –II Capital and
approaches to assess the capital adequacy.