Resources for Basel II Capital Accord (Basel II)

Revised Capital Framework To Give More Protection To Depositors

bernama.com

Bank Negara Malaysia (BNM) will be issuing revised capital frameworks for the banking institutions and insurers to promote greater protection for the various stakeholders of the respective sectors, particularly the depositors and policy holders.Under the new framework for the respective industries, the board of directors of the banking institutions and insurers are expected to play a greater role in enhancing the robustness of risk management infrastructure and market conduct governance, said the central bank in a statement Wednesday.The capital framework for the banking institutions, based on the standardised approaches under Basel II, will be effective from Jan 1, 2008.The standardised framework sets capital requirements by assigning predetermined risk weights to the various types of exposures.Banking institutions that have made significant progress in developing robust internal rating standards would be given the flexibility to adopt Internal Ratings-Based (IRB) approach in 2010 without having to comply with the standardised framework, said BNM.

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