Basel Norm

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  • Topic: Bank, Banks of India, Basel II
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el noThe Analysis of Basel Norms and Implementation

KLE SOCEITY’s INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH, VIDYANAGAR, HUBLI.

MASTERS OF BUSINESS ADMINISTRATION ( Recognised and Affiliated to Karnataka University Dharwad) Project on “The Analysis of Basel Norms and its implementation” Undertaken At State Bank of India, Main Branch, Dharwad

Internal Guide Prof: Prashanth.C Faculty KLE’s IMSR

Company Guide Mr.Subramanya Chief Manager State Bank of India

1 KLE’s Institute of Manageent Studies of Research

MBA IV Sem

The Analysis of Basel Norms and Implementation

Hubli

Dharwad

DECLARATION

I, Miss Shveta.R.Chikkamath hereby declare that the project for MCP title “ The Study of Basel Norms and its implementation” at State Bank of India, Main Branch Dharwad submitted in fulfillment of the requirement for the degree of “ Master of Business Administration” by Karnataka University Dharwad, is correct and by my own effort and is submitted elsewhere for the award of any degree.

Date: Place: ( Shveta.R.Chikkamath)

2 KLE’s Institute of Manageent Studies of Research

MBA IV Sem

The Analysis of Basel Norms and Implementation

ACKNOWLEDGEMENT
All my efforts will be meaningless, if I don’t express my sincere gratitude to the authorities, who rendered their support and guided me more than what I had expected from them, while carrying out my project. First and foremost I extend my heartfelt gratitude to our State Bank of India, Chief Manager Dharwad for giving me an opportunity to undertake my project in this prestigious bank. I express my sincere gratitude to Sir R.S. Prakash, Faculty Training Centre SBI and also Sir, Prasad Faculty Training Centre State Bank of India for their valuable support. I also express my gratefulness to Miss Shailaja. M.S Chief Manager, SBI Zonal Office. I also thank all SBI staff for supporting me in one or the other way. Dr.M.M.Bagali, I/c Director KLE’s Institute of Management Studies and Research for his encouragement in carrying out the project. I extend gratefulness to Prof Prashanth. C my institute guide his guidance. Lastly, I’m immensely grateful to my family and friends who have directly or indirectly Strived hard from commencement to completion of my project. \

3 KLE’s Institute of Manageent Studies of Research

MBA IV Sem

The Analysis of Basel Norms and Implementation

TABLE OF CONTENTS S.NO 1. 2. 3 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 INDEX EXECUTIVE SUMMARY INDUSRTY PROFILE COMPANY PROFILE The Analysis of Basel Norms and Implementation Background of Basel Accord BASEL I LOOPHOLES OF BASEL I OBJECTIVES OF BASEL II BASEL II GUIDELINES BASEL II FRAMEWORK CATEGORIES OF RISK CHALLENGES FOR INDIAN BANKING UNDER BASEL II CHALLENGES FOR SBI MIGRATION TO BASEL BY SBI IMPACT OF BASEL NORMS ON INDIAN BANKS IMPACT OF BASEL NORMS ON SBI RELATION BETWEEN BASEL I & BASEL II CONCLUSIONS FINDINGS SUGGESTIONS & LIMITATIONS BIBLIOGRAPHY Page No 6-9 11-26 28-33 35-51 53-57 58 62-64 65-66 67-68 69-86 87-90 91 92-93 94-98 99 100 101 102 103 105

4 KLE’s Institute of Manageent Studies of Research

MBA IV Sem

The Analysis of Basel Norms and Implementation

EXECUTIVE SUMMARY

In 1988 the Bank for International Settlements’ Basel Committee on Banking Supervision, commonly known as the Basel Committee, imposed the Basel Capital Accord. The Basel Capital Accord introduced a system for implementing a credit risk framework for determining the minimum amount of capital that a bank must hold as a cushion against risks. The Basel Capital Accord was adopted over time not only in member countries, but in virtually all countries operating international banks. One problem with the original Basel Capital Accord was that it took a "one size fits all" approach, without regard for the actual operational risk incurred by the bank. In 2004, the Basel II Accord was established. The new accord aligns the requirement for capital on hand with the actual risk...
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