BIA: Difference between revisions
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imported>Doug Williamson (Expand. Source BIS http://www.bis.org/publ/bcbs291.pdf) |
imported>Doug Williamson (Add example.) |
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Under the BIA, gross income is multiplied by a coefficient (alpha) to calculate the measure of risk weighted assets. | Under the BIA, gross income (GI) is multiplied by a coefficient (alpha) to calculate the measure of risk weighted assets. | ||
For example: | |||
GI x alpha = RWAs | |||
£10m x 15% = £1.5m | |||
Revision as of 11:06, 29 October 2016
Bank supervision - capital adequacy - operational risk.
Basic Indicator Approach.
The Basic Indicator Approach is a method of evaluation of certain operational risks for banks, for capital adequacy calculation purposes.
Under the BIA, gross income (GI) is multiplied by a coefficient (alpha) to calculate the measure of risk weighted assets.
For example:
GI x alpha = RWAs
£10m x 15% = £1.5m
