Goncharova M.V. Basel II International Convention: Influence on Banking Regulation in the Russian Federation. Part two

Goncharova Marina Vyacheslavovna

Doctor of Economic Sciences, Professor, Department of Economics,
Russian State Economic University named after G.V. Plekhanov (Volgograd Branch)
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Volgo-Donskaya St., 11, 400066 Volgograd, Russian Federation

Abstract. The article studies the basic concepts of the agreement on sufficiency of Basel II capital (“International convergence of capital measurement and capital standards: a revised Framework”) and its influence on banking regulation in the European Union and in the Russian Federation. The author analyzes the improved approaches and practical norms of international banking regulation.
The author considers the technology of reducing the credit risk within the standardized approach. The risk is primarily secured by the claim against the debtor and can be provided in advance of deposits in cash reserves and securities. The risk may be secured by a guarantee of a third party, the bank may also purchase a special financial instrument – credit derivative which allows for compensating risks by means of the credit derivative. If the borrower has a commercial bank, which lends to its deposit, the variant offset mutual claims refund of the deposit bank to the depositor against the repayment of the loan by the borrower to the bank. It may also be a requirement of return of the securities provided as collateral for the borrower’s loan obligation or requirement under the contract for OTC derivatives. The author will continue the study of credit risks using an approach based on internal ratings of the banks in the next article.

Key words: capital, sufficiency, credit risk, real-time control, market discipline, regulation, supervision, Сentral bank.

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