Regulatory Alerts2014-03-31 | 02/17/600/0029/001Schedule II Part V(a): Computation of Risk-Weighted Amount for Operational Risk
The regulatory authority establishes Schedule II Part V(a) to standardize how financial institutions calculate risk-weighted amounts for operational risk. It mandates three distinct methodologies—the Basic Indicator, Standardised, and Alternative Standardised Approaches—each applying fixed beta factors to eight designated business lines. By prescribing exact capital charge formulas and gross income components over a three-year period, the schedule ensures consistent regulatory capital assessments.
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