derivative market
INTRODUCTION
The Indian Financial System is tasting success of a decade of financial sector reforms. The economy is surging and has gathered the critical mass to convert it into a force to reckon with. The regulatory framework in India has sparked growth and key structural reforms have improved the asset quality and profitability of banks.
Growing integration of economies and the markets around the world is making global banking a reality. Widespread use of internet banking has widened frontiers of global banking, and it is now possible to market financial products and services on a global basis. In the coming years globalization would spread further on account of the likely opening up of financial services under WTO. India is one of the 104 signatories of Financial Services Agreement (FSA) of 1997. Thereby giving India’s financial sector including banks an opportunity to expand their business on a quid pro quo basis.
As in different sectors, competition is driving growth in the banking sector also. The RBI requires all banks to comply with the standardized approach of the BASEL II accord by 31st March, 2007. The quantification and accounting of various risks would result in a more robust risk management system in the industry.
This paper attempts to project the implications of this transition and its effects on the internal operations of a bank followed by its effects on the banking industry and the economy.
The Basel Accord or Basle Accord refers to the banking supervision Accords (recommendations on banking laws and regulations), Basel I and Basel II issued by the Basel Committee on Banking Supervision(BCBS). They are called the Basel Accords as the BCBS maintains its secretariat at the Bank of International Settlements in Basel, Switzerland and the committee normally meets there.
OBJECTIVES OF RISK MANAGEMENT
To get knowledge of the risk management in the banking Industry
What are the different types of risk in the Banking Industry?
How are
The Indian Financial System is tasting success of a decade of financial sector reforms. The economy is surging and has gathered the critical mass to convert it into a force to reckon with. The regulatory framework in India has sparked growth and key structural reforms have improved the asset quality and profitability of banks.
Growing integration of economies and the markets around the world is making global banking a reality. Widespread use of internet banking has widened frontiers of global banking, and it is now possible to market financial products and services on a global basis. In the coming years globalization would spread further on account of the likely opening up of financial services under WTO. India is one of the 104 signatories of Financial Services Agreement (FSA) of 1997. Thereby giving India’s financial sector including banks an opportunity to expand their business on a quid pro quo basis.
As in different sectors, competition is driving growth in the banking sector also. The RBI requires all banks to comply with the standardized approach of the BASEL II accord by 31st March, 2007. The quantification and accounting of various risks would result in a more robust risk management system in the industry.
This paper attempts to project the implications of this transition and its effects on the internal operations of a bank followed by its effects on the banking industry and the economy.
The Basel Accord or Basle Accord refers to the banking supervision Accords (recommendations on banking laws and regulations), Basel I and Basel II issued by the Basel Committee on Banking Supervision(BCBS). They are called the Basel Accords as the BCBS maintains its secretariat at the Bank of International Settlements in Basel, Switzerland and the committee normally meets there.
OBJECTIVES OF RISK MANAGEMENT
To get knowledge of the risk management in the banking Industry
What are the different types of risk in the Banking Industry?
How are