The Pillar 2 Supervisory Review Process is an integral component of Basel II, complementing and supplementing the minimum requirements of Pillar 1 and the disclosure requirements of Pillar 3. Pillar 2 seeks to ensure that banks have sound internal processes in place to assess the adequacy of their capital and determine the level of capital that is commensurate with their overall risk profiles. Pillar 2 also encourages the development and use of better risk management processes in monitoring and managing bank risks and is very compatible with a comprehensive risk-based supervisory (RBS) regime.

Objectives:  The key learning objective of this Course was to enable the participants to assess the bank's internal capital adequacy process in accordance to the Supervisory Review Evaluation Process (SREP) under Pillar 2 of Basel II Accord. In achieving the key objective, participants learnt to (i) describe supervisors' responsibilities in the supervisory review process covered in Pillar 2; (ii) identify the key features of an ICAAP and banks' responsibilities for internal capital assessment processes; and (iii) explain the compatibility between RBS and Pillar 2 and how the latter enhances supervisory review and risk assessment in a RBS regime.

Resource Persons: The faculty of resource persons for the Course comprises technical experts and senior officials from the Office of the Superintendent of Financial Institutions, Canada (OSFI), Bank of Thailand and Standard Chartered Bank, London.

Target Group: The participants comprised bank supervisors and examiners of central banks/monetary authorities involved in on-site supervision, development and implementation of RBS Methodology, Basel II Implementation and Pillar 2 Supervisory Review Process. A total of 36 participants representing 12 institutions from 12 economies attended the Course.