Regulatory Alerts2024-01-01
Operational Risk Guidelines 2024
The Registrar of Financial Institutions mandates the Standardized Measurement Approach for calculating operational risk capital charges across all banks and bank holding companies. This framework requires institutions to compute a Business Indicator and an Internal Loss Multiplier based on three-year income averages and ten-year historical loss data, applying tiered marginal coefficients to determine minimum capital requirements. Banks must maintain high-quality internal loss datasets, submit monthly prudential returns and quarterly Business Indicator disclosures, and obtain regulatory approval for specific data exclusions or interim multipliers during implementation.
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