BIS home Monetary & financial stability Basel II Basel II: Revised international capital framework
The Basel II Framework describes a more comprehensive measure and minimum
standard for capital adequacy that national supervisory authorities are now
working to implement through domestic rule-making and adoption procedures. It
seeks to improve on the existing rules by aligning regulatory capital
requirements more closely to the underlying risks that banks face. In addition,
the Basel II Framework is intended to promote a more forward-looking approach
to capital supervision, one that encourages banks to identify the risks they
may face, today and in the future, and to develop or improve their ability to
manage those risks. As a result, it is intended to be more flexible and better
able to evolve with advances in markets and risk management practices.
The efforts of the Basel Committee on Banking Supervision to revise the
standards governing the capital adequacy of internationally active banks
achieved a critical milestone in the publication of an agreed text in June
2004.
The original Basel II document is available in:
English | French | German | Italian | Spanish
In November 2005, the Committee issued an updated
version of the revised Framework incorporating the additional guidance
set forth in the Committee's paper The Application of
Basel II to Trading Activities and the Treatment of Double Default Effects
(July 2005).
On 4 July 2006, the Committee issued a comprehensive
version of the Basel II Framework. Solely as a matter of convenience to
readers, this comprehensive document is a compilation of the June 2004 Basel II
Framework, the elements of the 1988 Accord that
were not revised during the Basel II process, the 1996
Amendment to the Capital Accord to Incorporate Market Risks, and the
2005 paper on the Application of Basel II to Trading
Activities and the Treatment of Double Default Effects. No new elements
have been introduced in this compilation.
Latest news
2 June 2006
The Basel Committee on Banking Supervision issued a paper on
Home-host information sharing for effective Basel II implementation,
which sets forth general principles for sharing of information between home
country and host country supervisors in the implementation of the Basel II
Framework. This paper was developed jointly with the Core Principles Liaison
Group, which includes banking supervisors from sixteen non-Committee member
countries, as well as the International Monetary Fund and World Bank. The paper
highlights the need for home and host supervisors of internationally active
banking organizations to develop and enhance pragmatic communication and
cooperation with regard to banks' Basel II implementation plans, and also sets
out practical examples of information that could be provided by banks, home
supervisors and host supervisors.
24 May 2006
The Basel Committee on Banking Supervision issued a press
release indicating that the calibration of the Basel II Framework (ie,
1.06 scaling factor for credit risk-weighted assets under the internal
ratings-based approaches) will be maintained. This Committee's review of the
calibration of the Framework was based on the results of the
fifth Quantitative Impact Study (QIS 5), as well as QIS 4 which was
carried out in some jurisdictions. A detailed report on the results of QIS 5 in
G10 and non-G10 countries was published on 16 June 2006. National authorities
will continue to monitor capital requirements during the period of Basel II
implementation, and the Committee will monitor national experiences with the
Framework.
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