Our last post, “Basel III for Dummies” has raised the question about Basel II (which is after all the foundation to the Basel III upgrade). What is it? How is it structured? What does it cover?
For those wanting a bit more information we post this quick overview of Basel II framework that sets capital requirements for banks and forms the basis for Basel III. Three pillars contains the rules & support (supervisor review, market discipline) that say how much eligible regulatory capital must be held against risk-weighted assets.
Basel II is also where Operational Risk was introduced into the equation.
This short informative video covers all these bases.