The Australian Prudential Regulation Authority (APRA) today released two new discussion papers and accompanying draft prudential standards on the implementation of the Basel II capital adequacy regime, known as the Basel II Framework.
The first paper introduces the draft prudential standard for the standardised approach to operational risk. The second paper outlines APRA’s approach to the implementation of the internal ratings-based (IRB) approach to credit risk.
APRA’s Chairman, Dr John Laker, said APRA expects that the vast majority of authorised deposit-taking institutions (banks, building societies and credit unions) will use the standardised approach, rather than the IRB approach, in determining their regulatory capital charge for credit risk.
See full Press Release.
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