CIMA to analyse Basel II accord

Head of the banking supervision of the Cayman Islands Monetary Authority Reina Ebanks will analyse revisions of the Basel accords on banking laws and regulations at the International Financial Crime Prevention and Compliance Training programme at the Ritz Carlton on Thursday.

The initial accord, known as Basel I, made recommendations on banking regulations in regards to capital risk, market risk and operational risk. The measures sought to decrease the potential for bankruptcy among major international banks.

The Basel II revisions focus on three main areas; minimum capital requirements – making regulatory capital even more risk sensitive – market discipline, and a supervisory review.

The revised accord aims to improve the consistency of capital regulations across the globe, especially in leading financial centers.

Some of the revisions to the Basel I rules are under consideration and the conference will offer members of the island’s banking fraternity an opportunity to put forward their positioning to the regulator, seeking clarifications prior to the deadline for implementation.

Banks also get an insight into the thinking of international regulators as to some of the lessons to be learned at this time.

Gert Demmink, former Head of Supervision at the Dutch Central Bank, and responsible for creation of supervisory bodies in some of the Dutch protectorates in the Caribbean will be discussing the Senior Supervisor’s Group report on the factors which caused performance differentials in the teeth of the global crisis.

The report by the Swiss Federal Banking Commission, French Banking Commission, German Federal FSA, US SEC and Federal Reserve and UK FSA assessed a range of risk management practices among a sample of international financial institutions.

Their findings may lead to changes in supervisory requirements, expectations and therefore guidance for the islands banking community may be needed.