Basel III Professional Table of Contents


Table of Contents
 


Module 1: Introduction to Banking Regulation & the Basel Framework

  • Evolution of international banking regulation
  • Role of the Bank for International Settlements (BIS) and the Basel Committee on Banking Supervision (BCBS)
  • From Basel I to Basel III: a historical overview
  • The 2008 Global Financial Crisis and the regulatory response
  • Basel Accords vs. national implementation — how a global standard becomes domestic law

Module 2: Basel I Framework

  • Background and objectives of the 1988 Capital Accord
  • Credit risk-weighted assets under Basel I
  • Capital Adequacy Ratio (CAR) computation under Basel I
  • The 1996 Market Risk Amendment
  • Limitations and shortcomings that led to Basel II

Module 3: Basel II Framework

  • The Three-Pillar structure of Basel II
  • Pillar 1 — Minimum Capital Requirements
  • Credit risk approaches: Standardized, Foundation IRB, Advanced IRB
  • Operational risk approaches
  • Pillar 2 — Supervisory Review Process
  • Pillar 3 — Market Discipline and Disclosure
  • Weaknesses exposed by the 2008 financial crisis

Module 4: Basel III — Core Reforms (2010–2017)

  • Genesis and objectives of Basel III
  • Enhanced quality and quantity of regulatory capital
  • Components of capital
  • Regulatory deductions and adjustments to capital
  • Minimum Capital Adequacy Ratio (CAR) requirements
  • Capital Conservation Buffer (CCB)
  • Countercyclical Capital Buffer (CCyB)
  • Leverage Ratio — rationale, calculation, and role as a backstop to risk-based capital

Module 5: Basel III Finalized Reforms 

  • Why the Basel Committee revisited Basel III
  • Overview of the December 2017 finalization package
  • Revised Standardized Approach (SA) for credit risk
  • Revisions to the Internal Ratings-Based (IRB) approach and constraints on internal-model use
  • Removal of the 1.06 scaling factor on IRB risk-weighted assets
  • Revised Credit Valuation Adjustment (CVA) risk framework
  • Revised operational risk framework
  • The Output Floor — concept, 72.5% calibration, and phase-in schedule
  • Revised leverage ratio and the G-SIB leverage ratio buffer
  • Revised securitisation framework
  • Jurisdictional variants
  • Global implementation status 

Module 6: Credit Risk Measurement

  • Standardized Approach (SA)
  • Use of external ratings and due-diligence requirements
  • Internal Ratings-Based (IRB) Approach
  • Probability of Default (PD), Loss Given Default (LGD), Exposure at Default (EAD)
  • Credit Risk Mitigation (CRM) techniques and eligible collateral
  • Securitisation Framework

Module 7: Market Risk Framework — FRTB

  • Evolution from the 1996 Market Risk Amendment to the Fundamental Review of the Trading Book (FRTB)
  • Trading book vs. banking book boundary
  • Standardized Approach — Sensitivities-Based Method
  • Internal Models Approach (IMA) and the shift to Expected Shortfall
  • Default Risk Charge and Residual Risk Add-On

Module 8: Operational Risk Framework

  • Recap of Basel II approaches (BIA, TSA, AMA) and why they were replaced
  • The Standardized Measurement Approach (SMA) under Basel III
  • Business Indicator (BI) and Business Indicator Component (BIC)
  • Internal Loss Multiplier (ILM) and internal loss-data requirements

Module 9: Liquidity Risk Standards

  • Rationale for liquidity regulation after the 2008 crisis
  • Liquidity Coverage Ratio (LCR)
  • Net Stable Funding Ratio (NSFR)
  • Liquidity risk monitoring tools and contingency funding plans
  • Interaction between LCR/NSFR, the leverage ratio and capital requirements

Module 10: Capital Buffers & Systemic Risk

  • Capital Conservation Buffer and Countercyclical Buffer
  • Global Systemically Important Banks (G-SIBs)
  • Domestic Systemically Important Banks (D-SIBs)
  • Total Loss-Absorbing Capacity (TLAC) requirement for G-SIBs
  • Linkages to recovery and resolution planning

Module 11: Pillar 2 & Pillar 3 — Supervisory Review and Market Discipline

  • Internal Capital Adequacy Assessment Process (ICAAP)
  • Supervisory Review and Evaluation Process (SREP)
  • Revised Pillar 3 disclosure requirements and reporting templates
  • Interest Rate Risk in the Banking Book (IRRBB)

Module 12: Stress Testing & Capital Planning

  • Purpose and design of regulatory stress tests
  • Scenario design: baseline, adverse, and severely adverse scenarios
  • Reverse stress testing
  • Forward-looking capital planning
  • Comparative overview

Module 13: Basel III Implementation in India

  • RBI's phased implementation of Basel III since April 2013
  • Master Circular on Basel III Capital Regulations — current CRAR and CET1 requirements
  • RBI's Liquidity Coverage Ratio and Net Stable Funding Ratio guidelines for Indian banks
  • The D-SIB framework in India
  • RBI's revised Standardised Approach Directions for credit risk (effective 1 April 2027)
  • Applicability and exemptions

Module 14: Global Comparative Perspective

  • United States — "Basel III Endgame"
  • United Kingdom — "Basel 3.1"
  • European Union — CRR3/CRD6, live since 1 January 2025
  • Cross-jurisdictional divergence and implications for internationally active banks

Module 15: Case Studies & Practical Application

  • Capital adequacy ratio computation exercises
  • Risk-weighted asset calculation
  • LCR and NSFR computation exercise
  • Assessing the impact of the output floor on a sample bank's capital requirement

 


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