Experience in system integration and process mapping to Basel II business standards utilizing SAS, Oracle, and Informatica.
Deep consulting and integration expertise of Reveleus' Business Intelligence and Decision Support System, including:
- Customer Profitability
- CRM Analytics
- Channel Analytics
- Enterprise Financial Performance
- Credit Risk Analytics
- Asset Liability Management
- Funds Transfer Pricing
In depth expert-level knowledge in system implementation and process customizations of all Algorithmics modules, Moody's Fermat integrated risk and performance management software, as well as Moody's Risk Frontier credit portfolio management and economic capital including:
- Commercial Mortgage Metrics
- Fermat - CAD
- Fermat - Liquidity Risk
- Financial Analyst
- Credit Monitor
- Portfolio Manager
The Banking and Financial Services industry has undergone significant transformation in various critical business processes like risk management practices, supervisory approaches, and capital requirement assessments. Since the introduction of Basel II Accord, Consolidation, Advanced Risk Management techniques, Data Management and Reporting models have evolved as a major concern.
Pillar III of Basel II Accord complements the minimum capital requirements (Pillar I) and the supervisory review process (Pillar II). It features Market Discipline that requires banks to disclose essential information regarding their capital allocation and the risks they take beyond current financial reporting guidelines.
Developing an IT risk management strategy
Basel II requires banks to develop a risk management framework that can:
- Maintain data integrity - Banks should prevent identity theft and data leakage by applying the principles of least privilege and deft error handling. External electronic devices like pen drives and camera phones should be restricted as far as possible. Firewalls should be in put in place and constantly updated to prevent malware or spyware from infecting the system.
- Prevent unauthorized transactions into the system - A robust authentication system will prevent system compromise and fraud. Apart from recognized legitimate agents, no one else must be allowed to execute transactions within the bank. The code developed must ensure that there is no provision for a guest account to be created. Strong password policies should be implemented with strong encryption. An automatic system log-off should be used to prevent unauthorized users from accessing an unguarded system.
- Prevent unauthorized changes to the software - Unauthorized modifications to the bank software lead to fraudulent practices and render the system weak. A robust change management system that allows only authorized changes should be implemented. Every change should be tracked and monitored. In case of suspected fraud, the change management system must leave a clear audit trail that traces every change in the system.
- Ensure system backup - Basel II mandates that the system must be available always. System back-up plans should be put in place. The system must be able to withstand high loads and perform at optimal speeds. It is impractical to revert to manual calculation in case of system downtime or failure. So it is extremely crucial to have in place contingencies that can handle unexpected system downtime and failures.
- Implement business continuity/disaster recovery plans - In a business environment characterized by natural disasters, vandalism, terrorist attacks, epidemics and technological failures, it is imperative to implement an effective business continuity plan. Banks should develop a recovery strategy that targets technical systems, management and employees. The awareness around BCP plans should be raised and mock drills conducted. Effective crisis communication tools should also be developed.
Jaggy supports banks across their complete Basel II implementation life-cycle through the following service offerings:
- Risk assessment and analysis
- Control design and assessment
- Loss Tracking and Key Risk Indicators (KRIs)
- Issue Management and Remediation
- Internal Audit
- Technical project planning, management, system design and implementation of Basel II compliant processes and systems
- Experience in system integration and process mapping to Basel II business standards utilizing SAS, Oracle, and Informatica
- In depth expert-level knowledge in system implementation and process customizations of Oracle Reveleus, Moody's Fermat integrated risk and performance management software, as well as Moody's Risk Frontier credit portfolio management and economic capital.
- Basel ii and iii certified professionals
- Hands on implementation experience
- Functional and Technical consultants
Jaggy Assurance and Risk Management Basel II Service enable financial institutions to:
- Gain an in-depth understanding of scenarios and their associated level of risk
- Help ensure compliance by creating audit trails to meet disclosure requirements
- Define and maintain various statistical models to gain a greater understanding of risk levels
- Increase the accuracy of capital calculations for estimation of PD, LGD, EAD, and allocation of credit risk mitigants to exposures
- Reduce compliance complexity and cost through greater readiness and easier deployment
- Cost-effectively modify rules management to suit the demands of new jurisdictions, changed business needs, or new regulatory requirements
- Identify changes in key parameters over time, drivers of change, and the change attributed to each driver
- Ensure Basel II compliance for Islamic banking products based on Sharia law
Please contact us to discuss how Jaggy can help address Basel II compliance for your institution.