Regulatory Alerts2022-03-28 | CBE3.1Added · Updated
CBE Regulation Book 3.1 - Capital Adequacy Standard Operational Risks Using The Standard Method
The Central Bank of Egypt mandates that all banks operating in Egypt transition from the Basic Indicator Approach to the Standardized Approach (SA) for calculating capital requirements for operational risk, effective by December 31, 2021. This regulation defines the Business Indicator (BI), the weighted Business Indicator Component (BIC), and the Internal Loss Multiplier (ILM) to determine the Operational Risk Capital (ORC) requirement. Banks are required to maintain robust operational risk management frameworks, including independent management units, board oversight, and detailed loss data collection, with specific thresholds for reporting losses and utilizing internal loss data for capital calculations.
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