Adapting to Basel III and the Financial Crisis: Re-engineering capital, business mix, and performance management practices

As a result of Basel III and Solvency II, all financial institutions will have to re-think their business planning and strategic management practices whilst also trying to meet their income needs. Adapting to Basel III and the Financial Crisis examines how the financial sector is tackling these challenges, drawing on a variety of examples from the banking and insurance industries. Bogie Ozdemir and Peter Miu combine their experiences in banking, insurance, and academia, providing a balanced combination of both hands-on experience and theoretical reasoning. The authors demonstrate how best to implement these regulations on a practical level, explaining the organizational (re)alignments to ensure that the necessary changes are made. The authors equip the reader with the tools to enhance their capital management and business mix optimization processes in order to cope with the rigors of the new regulatory landscape, with key topics including: Integrated Capital Management; ICAAP and ORSA Design; Risk Appetite; Economic Capital for Defaulted Loans; Performance Management; Capital Planning and Budgeting; Economic Capital for Insurance Companies; RAROC and Loan Specific Hurdle Rate; Evolving Role of the Risk Function and Organization Re-design; and Procyclicality Management. Adapting to Basel III and the Financial Crisis is aimed at all risk and capital management practitioners in banks and insurance companies, as well as national and international regulators of financial institutions and Basel II, Basel III, and Solvency II implementing practitioners.