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ERM Frameworks and Responses to risk [19]

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Bullet points include: Some overarching similarities, e.g. holistic aims and 3 Pillars: Pillar 1: Minimum (regulatory) capital requirements Pillar 2: Supervisory review process – regulators (supervisors) review how firms themselves assess they have adequate capital Pillar 3: Market discipline – firms have to disclose information on adequacy of their capitalisation Will no doubt miss things (e.g. under-focus of Basel II on liquidity risk) Overarching regulatory designs tend to cross industry types Public and politicians do not necessarily differentiate between firm types Regulators are often unitary

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