Summary |
Economic capital as a concept has been gathering pace since the introduction of Basel II and solvency II for the banking and insurance industries, with the Basel II framework now in place, banks and financial intermediaries – insurance, assets management, hedge funds, and other – worldwide will be involved in the implementation of economic capital. The recent credit crisis has highlighted the need for institutions to have a robust framework in place for measuring economic capital.
This new addition to the risk books introductory series identifies the basic building blocks for economic capital measurement. It familiarizes and trains the reader with the economic capital computation approaches and taxonomy, covering the policies, organization measurement and controls necessary for an institution to invent their own techniques and parameters for the risk models.
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