Risk-Based Banking Supervision (BSO)

Source details

The course covers the fundamentals and goals of risk-based supervision (RBS), its challenges, and factors central to its success.
Through a mix of lectures and practical applications, the course covers the main RBS components and steps for implementation.
Guidance is provided on using risk-based assessment and rating to help supervisors decide relevant supervisory priorities and early intervention measures to address bank fragilities.
The course begins by introducing the RBS approach and challenges for effective implementation of RBS in prudential regulations and supervisory processes.
The focus then turns into presenting RBS assessment methodologies of banks' financial soundness, with highlights on governance and risk management frameworks, as well as various risk domains (credit, liquidity, market, and operational), referring to existing supervisory bank-rating models for illustration.

Mid- to senior level staff of central banks or standalone banking supervision authorities involved in banking regulation and supervision (especially microprudential).

Participants are expected to be familiar with banking regulation and supervision issues, with several years of practical, hands-on supervisory experience.

Upon completion of this course, participants should be able to:

Understand the importance and methodology of risk-based banking supervision.
Develop risk-based and forward-looking assessments of banks risk profiles that may enable preventive and corrective supervisory action targeting weak banks.
Enhance their country's approach to risk-based banking supervision, focusing on early identification of material risks.
Incorporate the risk-based approach into supervisory objectives, supervisory planning, remedial actions, and organization and processes.