Basel Accord


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Basel Accord

Agreement concluded among country representatives in 1988 in Switzerland to develop standardized risk-based capital requirements for banks across countries.

Basel Accord

An agreement on international banking regulations dealing with how banks handle risk. The Basel Accord focuses mainly on credit risk; it divides banks' assets into five categories according to how risky they are. The five categories are assets with no risk, 10% risk, 20%, 50% and 100%. All banks conducting international transactions are required under the Basel Accord to hold assets with no more than 8% aggregated risk. The Accord was promulgated in 1988.Banks in most G-10 countries have implemented it since the early 1990s. It is now considered largely outdated and is in the process of being replaced by Basel II. It is also called Basel I.
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Our results also indicate that the effect of capital regulation on bank risk and cost efficiency is different for each of the Basel accords.
Franzetti gives background details on the three pillars of the Basel accord and describes the three options provided for operational risk quantification, including different views on their strengths and weaknesses.
INTERNATIONAL REGULATORY REGIMES: BRETTON WOODS AND THE BASEL ACCORDS A.
In light of the 2008 financial crisis, new international banking regulations, notably those of the Ihird Basel Accord, pay close attention to banks' liquidity.
But sadly this is what our so-called Resolution Authority has decided, having failed in its initial effort to create four different classes of shares -- something not provided for in the Basel Accord.
Bank regulators across the world have adopted Basel Accord guidelines for risk measurement and management at their constituent banks.
Global Banking News-December 18, 2012--Banking supervisors believe Basel accord won't be affected by delays(C)2012 ENPublishing - http://www.
Commenting on the conference that will be held at the end of the month in Abu Dhabi -- with main speakers Dr Jasem Al Mannaei, Chairman of the Arab Monetary Fund (AMF), Nasser Al Suwaidi, UAE Central Bank Governor, and many other international and regional financial experts -- Dr Ashour said that the meeting will highlight the UAE measures with regard to the implementation of the latest Basel Accord.
The second Basel Accord, Basel II, was developed in response to perceived shortcomings, in particular with the asset risk-weighting system, discussed in more detail in Appendix A.
The CBC, for instance, regulates that corporate bonds can be treated as liquid reserve assets but the new Basel Accord stipulates that corporate bonds must be discounted in being listed as liquid assets and corporate bonds without adequate credit rating are disqualified.