Basel Accord

(redirected from Basle Accord)

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 It is now considered largely outdated and is in the process of being replaced by Basel II.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.
Mentioned in ?
References in periodicals archive ?
This has changed and a system was created by the BIS: the 1988 Basle Accord.
The current regulatory regime of the Basle Accord (21) imposes the same risk-based capital charge on differently rated loans.
This stands in stark contrast to the importance attached to capital adequacy in the regulation of banks, especially since the adoption of the Basle Accord in 1988, which established risk-based capital requirements in the Group of Ten countries.
Michael Zerbs, Algorithmics' Vice President of Research and Product Marketing, says today's turbulent financial markets, increasingly complex financial systems, and the enhanced regulations specified by the Basle Accord have led executives and risk managers to realize the importance of proactively measuring and managing operational risk.
The most recently reported capital ratios of DKB exceed the relevant risk-based capital standards established under the Basle Accord, and the proposed transaction is not expected to have a material effect on the capital of the consolidated organization.
3 Counterparty risk is considered under the 1988 Basle Accord in which banks are required to set aside capital for off-balance-sheet and derivative instruments (see Basle, 1988).
On top of that, banks must scramble to meet the so-called Basle Accord international capital-adequacy standards.
The principal objectives of the Basle Accord and the U.
This book evaluates the implementation of the Basle Accord from a legal and financial point of view.
4% on a consolidated basis, well above the 8% minimum requirement of the Basle Accord, as adopted by the Central Bank (Resolution 2099/94 of the Central Bank of Brazil).
With the new proposal of the 1988 Basle Accord suggesting the implementation of discriminatory risk-weightings across rating categories, the prospective change of the current regulatory regime will censure institutional arbitrage on regulatory capital requirements, which has hitherto motivated asset-backed securitisation.
11) San Paolo-IMI's capital ratios satisfy applicable risk-based standards under the Basle Accord and are considered equivalent to the capital levels that would be required of a United States banking organization.