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Basel ll represents the most fundamental change seen in financial services capital regulation in the past 15 years. But if you see it as yet another “tick box” burden, you’re missing the point. Basel II is a top level business issue that has far reaching strategic implications for:
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Market structure
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Product design
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Customer selection
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Pricing
Focusing on the changes needed to optimise Basel II’s business impact could turn Basel II into a competitive boon, rather than a regulatory burden.
Timely rewards for integrated approach
Most organisations are now well into Basel ll preparation and will have the necessary models and data collection activities to comply with the 1 January 2007 “go live” date.
"Winners" are likely to include some or all the following:
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Organisations which invest wisely in risk management
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Larger lenders with sophisticated treasury operations
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Collateral-efficient institutions
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Institutions able to demonstrate that they are good at managing operational risk
Smarter banks will also have managed the cross-over with IAS/IFRS, Integrated Prudential Sourcebook and Sarbanes-Oxley and are driving for a transformation in the finance and risk management functions as part of their Basel II implementation.
"Losers" could be those with all or some of the following unless they take remedial action: low retail exposures, significant specialised lending, large equity holdings or smaller banks with comparatively unsophisticated risk management systems and poor operational risk experience; those who securitise need to tread carefully.
Market leading advice
Deloitte is a leading adviser on Basel ll.
Basel II is a multi-faceted challenge requiring a multi-disciplinary solution. We are the only adviser able to provide the required breadth of service. In addition, the wealth of experience that our team has built-up, combined with our developed software and tools, will enable you to shave months off implementation timelines and so get ahead of the game.
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