Basel II: Revised international capital framework

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A consultative document on Global systemically important banks: Assessment methodology and the additional loss absorbency requirement

Measures for global systemically important banks agreed by the Group of Governors and Heads of Supervision

 

The efforts of the Basel Committee on Banking Supervision to revise the standards governing the capital adequacy of internationally active banks achieved a critical milestone in the publication of an agreed text in June 2004.

The original Basel II document is available in:

English | French | German | Italian | Spanish

In November 2005, the Committee issued an updated version of the revised Framework incorporating the additional guidance set forth in the Committee's paper The Application of Basel II to Trading Activities and the Treatment of Double Default Effects (July 2005).

On 4 July 2006, the Committee issued a comprehensive version of the Basel II Framework. Solely as a matter of convenience to readers, this comprehensive document is a compilation of the June 2004 Basel II Framework, the elements of the 1988 Accord that were not revised during the Basel II process, the 1996 Amendment to the Capital Accord to Incorporate Market Risks, and the 2005 paper on the Application of Basel II to Trading Activities and the Treatment of Double Default Effects. No new elements have been introduced in this compilation.

 

Regulatory framework chronology 2006-2009


17 December 2009

The Basel Committee announced consultative proposals to strengthen the resilience of the banking sector:

The Committee welcomes comments from the public on all aspects of these consultative papers by 16 April 2010.

13 July 2009

The Basel Committee issued a final package of measures to enhance the three pillars of the Basel II framework and to strengthen the 1996 rules governing trading book capital. These measures were originally published for public consultation in January 2009.

16 January 2009

The Basel Committee announced a series of proposals to enhance the Basel II framework. The consultative package consists of the following:

 22 July 2008

The Basel Committee on Banking Supervision issued for public comment Guidelines for Computing Capital for Incremental Risk in the Trading Book as well as Proposed Revisions to the Basel II market risk framework. The proposed incremental risk charge would capture price changes due to defaults as well as other sources of price risk, such as those reflecting credit migrations and significant moves of credit spreads and equity prices. The Basel Committee also proposes improvements to the Basel II Framework concerning internal value-at-risk models. It has further aligned the language with respect to prudent valuation for positions subject to market risk with existing accounting guidance. In addition, it has clarified that regulators will retain the ability to require adjustments to current value beyond those required by financial reporting standards, in particular where there is uncertainty around the current realisable value of a position due to illiquidity. The Committee welcomes comments from the public on all aspects of these consultative papers by 15 October 2008.

2 June 2006

The Basel Committee on Banking Supervision issued a paper on Home-host information sharing for effective Basel II implementation, which sets forth general principles for sharing of information between home country and host country supervisors in the implementation of the Basel II Framework. This paper was developed jointly with the Core Principles Liaison Group, which includes banking supervisors from sixteen non-Committee member countries, as well as the International Monetary Fund and World Bank. The paper highlights the need for home and host supervisors of internationally active banking organizations to develop and enhance pragmatic communication and cooperation with regard to banks' Basel II implementation plans, and also sets out practical examples of information that could be provided by banks, home supervisors and host supervisors.

24 May 2006

The Basel Committee on Banking Supervision issued a press release indicating that the calibration of the Basel II Framework (ie, 1.06 scaling factor for credit risk-weighted assets under the internal ratings-based approaches) will be maintained. This Committee's review of the calibration of the Framework was based on the results of the fifth Quantitative Impact Study (QIS 5), as well as QIS 4 which was carried out in some jurisdictions. A detailed report on the results of QIS 5 in G10 and non-G10 countries was published on 16 June 2006. National authorities will continue to monitor capital requirements during the period of Basel II implementation, and the Committee will monitor national experiences with the Framework.