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Basel III and Its Consequences

Confronting a New Regulatory Environment

Introduction

Recent fiscal crises demonstrated numerous weaknesses in the global regulatory framework and in banks risk management practices. As a result, regulatory authorities have discussed several new measures to increase the stability of the financial markets. One central focus is strengthening global capital and liquidity rules (Basel III) with the goal of improving the banking sectors ability to absorb shocks arising from financial and economic stress [Source: Basel Committee on Banking Supervision (Dec. 2010) - Basel III: A global regulatory framework for more resilient banks and banking systems]. Basel III introduces several new or enhanced rules, including the introduction of a new and stricter definition of capital designed to increase quality, consistency and transparency of the capital base and the introduction of a global liquidity standard. The two new liquidity ratios the short-term Liquidity Coverage Ratio (LCR) and the longer-term Net Stable Funding Ratio (NSFR) speak to the need for banks to increase their high-quality liquid assets and
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obtain more stable sources of funding, while requiring they adhere to sound principles of liquidity risk management. Basel III also imposes a new leverage ratio, a supplement to the risk-based Basel II framework. By setting 3 percent as the ratio of Tier 1 Capital to total exposure, the new leverage ratio may limit banks scope of action. Moreover Basel III increases capital requirements for counterparty credit risk arising from derivatives, repurchase agreements (repos) and securities financing activities. The new framework also contains measures addressing the reduction of the cyclical effects of Basel II, as well as the reduction of systemic risk. For instance, it introduces a capital conservation and countercyclical capital buffer, and discusses throughthe-cycle provisioning [Sources: Basel Committee on Banking Supervision (Dec. 2010) - Basel III: A global regulatory framework for more resilient banks and banking systems and Basel Committee on Banking Supervision (Dec. 2010) - Basel III:

International framework for liquidity risk measurement, standards and monitoring]. Basel IIIs approach to systematically important financial institutions (SIFIs) has not yet been finalized, but may include a combination of capital surcharges, contingent capital and bail-in debt.1 Another Basel III element under discussion is the so-called single rule book, i.e. the creation of a level playing field and the removal of discretionary rule-making at the national level. The new regulations will increase capital requirements and drive up capital as well as liquidity costs and thus increase pressure on banks profitability.

Currently there is no classification of SIFIs.

Basel III elements and key aspects

Basel III elements Regulatory Capital

Key aspects Raising quality, consistency and transparency of the capital base Predominant form of Tier 1 Capital must be common shares and retained earnings (common equity Tier 1, [CET1]) Deductions have been harmonized and generally applied at the level of CET1 Tier 2 Capital instruments will be harmonized Tier 3 Capital instruments will be eliminated Raising capital requirements for the trading book and complex securitizations Capital requirement for counterparty credit risk (CCR) based on stressed inputs Capital charge for potential mark-to-market losses (credit valuation adjustment, [CVA]) Raising counterparty credit risk management standards (e.g. wrong way risk) Strengthening standards for collateral management and initial margining Establishing strong standards for central counterparties (CCP) Introducing leverage ratio as a supplementary measure to the risk-based Basel II framework Dampening cyclicality of the minimum requirements (e.g. through-the-cycle parameters)* Promoting stronger forward looking provisioning (expected loss approach)* Introducing capital conservation buffer Introducing countercyclical buffer Addressing systemic risk and interconnectedness (e.g. capital surcharge for SIFIs)* Introducing liquidity coverage ratio (LCR) Introducing net stable funding ratio (NSFR) Introducing common set of monitoring tools
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Risk Coverage

Leverage Ratio Procyclicality

Liquidity Standard

* Discussions on final requirements are ongoing.

Timeline
Figure 1: Phase-in arrangements [Sources: Basel Committee on Banking Supervision (Dec. 2010) - Basel III: A global regulatory framework for more resilient banks and banking systems and Accenture Risk Management] Capital
Min. Core Tier 1 Capital Ratio (% of RWA) Capital Conservation Buffer (% of RWA) Min. Core Tier 1 plus Capital Conservation Buffer (% of RWA) Phase-in of deductions from Core Tier 1 Min. Tier 1 Capital (% of RWA) Min. Total Capital (% of RWA) Min. Total Capital plus Capital Conservation Buffer (% of RWA) Countercyclical Buffer Capital instruments that no longer qualify as Non-Core Tier 1 Capital or Tier 2 Capital 4.5% 8.0% 8.0% 3.5% 4.0% 20% 5.5% 8.0% 8.0% 4.5% 40% 6.0% 8.0% 8.0% 2013 3.5% 2014 4.0% 2015 4.5% 2016 4.5% 0.625% 5.125% 60% 6.0% 8.0% 8.625% 2017 4.5% 1.25% 5.75% 80% 6.0% 8.0% 9.125% 2018 4.5% 1.875% 6.375% 100% 6.0% 8.0% 9.875% as of 2019 4.5% 2.5% 7.0% 100% 6.0% 8.0% 10.5%

Range between 0-2.5% (common equity or other fully loss absorbing capital) Phased out over 10 year horizon beginning 2013 (reduction of 10% per year)

Liquidity Standard
Introduction LCR and NSFR* LCR NSFR Leverage Ratio**

Leverage Ratio
Introduction Leverage Ratio Note: Orange numbers indicate transition periods and all dates are as of January 1st. * Reporting to supervisory authorities is expected by January 1, 2012 for both. ** January 1, 2013 to January 1, 2017 parallel run period.

According to the current consultation paper [Sources: Basel Committee on Banking Supervision (Dec. 2010) - Basel III: A global regulatory framework for more resilient banks and banking systems and Basel Committee on Banking Supervision (Dec. 2010) - Basel III: International framework for liquidity risk measurement, standards and monitoring] the new rules will come into force January 1, 2013, thereby different phase-in arrangements have been agreed to (see Figure 1). Although some Basel III requirements will be introduced at a later stage, with full implementation by 2019 [Sources: Basel Committee on Banking Supervision (Dec. 2010) - Basel III: A global regulatory framework for more resilient banks and banking systems and Basel Committee on Banking Supervision (Dec. 2010) Basel III: International framework for liquidity risk measurement, standards and monitoring], banks should deal actively with the new regulations now. Large banks are already taking

actions such as issuance of capital under consideration of the new eligibility criteria or adjusting their funding strategy, to comply with Basel III. The market expects banks to comply with Basel III before the regulatory timeline pushing them to a faster implementation. In addition, the observation periods require banks to be able to calculate their new ratios before the introduction date [Sources: Basel Committee on Banking Supervision (Dec. 2010) - Basel III: A global regulatory framework for more resilient banks and banking systems and Basel Committee on Banking Supervision (Dec. 2010) - Basel III: International framework for liquidity risk measurement, standards and monitoring]. The implementation as well as the timeline of the new regulations will vary from region to region. For instance in Switzerland the authorities have defined additional capital requirements beyond the base as defined in Basel III (Swiss Finish). In the European Union (EU), Basel III

will be implemented with the Capital Requirements Directive IV (CRD IV) which should be published by the European Commission in June or July 2011. While the political process is quite advanced in the EU, some aspects of Basel III need further discussion, such as the definition of high-quality liquid assets. Other topics will be tested during the observation periods. Also in discussion is whether some elements of Basel III should be implemented directly through an EU Regulation without any adjustment by the national authorities. Finally, it should be noted that several amendments to the capital framework have already been implemented through the CRD II and CRD III (e.g. in the area of securitization or in hybrid capital instruments).

Challenges Banks Have To Face


Figure 2: Impact of Basel III on the calculation of the Capital Ratio [Source: Accenture Risk Management]
Basel III requires better capital endowment and simultaneously results in higher RWAs

Required capital ratio


Increased capital requirements

Capital (according to new definition) RWA (Credit-, Market-, Operational Risk)


Stricter capital definition 0-2.5% 0.6% 2.0% 1.5% 4.5% 2016 1.3% 2.0% 1.5% 4.5% 2017 1.9% 2.0% 1.5% 4.5% 2018 2.5% 2.0% 1.5% 4.5% 2019
Increased quality of Tier 1 Capital (going concern) Simplification and reduction of Tier 2 Capital (gone concern) Elimination of Tier 3 Capital New eligibility criteria and limits for capital components

4.0% 2.0% 2.0% -2012

3.5% 1.0% 3.5% 2013

2.5% 1.5% 4.0% 2014

2.0% 1.5% 4.5% 2015

Increased RWAs
Higher risk weights for (re-)securitizations Higher capital requirements for trading book positions (Stressed-VaR, Incremental Risk Charge) Higher capital requirements for counterparty credit risk exposures arising from derivatives, repo-style transactions and securities financing activities (CVA risk, Wrong Way risk)

Core Tier 1 Capital Non-core Tier 1 Capital Tier 2 Capital Capital Conservation Buf f er Countercyclical Buf f er

Basel III will undoubtedly hit banks hard through its range of new and stricter regulations, whether because of higher capital requirements, the new liquidity standard, the increased risk coverage, the new leverage ratio or a combination of the different requirements. The aggregate effect of the requirements both those that are imminent and those that are still in discussion will vary from bank to bank, and among large banks almost all will have to deal with its farreaching implications. Taking a closer look at the changes in the capital requirements, we see a number of negative effects whose interplay can stress banks capital base significantly. On the one hand the stricter capital definition lowers banks available capital. At the same time the risk weighted assets (RWA) for securitizations, trading book positions and certain counterparty credit risk exposures are significantly increased. Both effects decrease banks realized capital ratios enormously. On the

other hand the required capital ratio is increased over the next few years till 2019 (see Figure 2). These two counterbalancing effects will pose a major problem for some banks to meet the required capital ratio, making corresponding measures inevitable. This major impact can also be seen in the latest Quantitative Impact Study (QIS) published by the Basel Committee on Banking Supervision (BCBS) in December 2010. One important result is that a full implementation of the Basel III package would lead to a reduction of CET 1 Capital by more than 40 percent, creating a shortfall of 577 billion Euros for the 91 Group 1 banks [Source: Basel Committee on Banking Supervision (Dec. 2010) : Results of the comprehensive quantitative impact study] i.e., those participants of the study that have Tier 1 Capital in excess of 3 billion Euros; are well diversified; and are internationally active. The expected decline in CET 1 Capital is attributable primarily to

reductions in the goodwill that banks can carry on their balance sheet and the deduction of deferred tax assets [Source: Basel Committee on Banking Supervision (Dec. 2010) : Results of the comprehensive quantitative impact study]. At the same time the Group 1 banks overall RWA would increase by 23 percent, mainly due to increased capital charges for counterparty credit risk (CCR) and trading book exposures [Source: Basel Committee on Banking Supervision (Dec. 2010) : Results of the comprehensive quantitative impact study]. In addition to the stricter capital requirements, the introduction of the LCR and NSFR will force banks to rethink their liquidity position, and potentially require banks to increase their stock of high-quality liquid assets and to use more stable sources of funding. Again the BCBSQIS documents an urgent need for a dramatic change in banks liquidity management. Large banks currently have an average LCR of 83 percent,

whereas the EU-QIS conducted by the Committee of European Banking Supervisors (CEBS)2 in December 2010 shows an even lower ratio of 67 percent [Source: Committee of European Banking Supervisors (Dec. 2010): Results of the comprehensive quantitative impact study]. For the NSFR, the results are slightly less severe but would still make corresponding measures necessary, with an average NSFR for large banks of 93 percent in the BCBS-QIS and 91 percent in the EU-QIS [Source: Committee of European Banking Supervisors (Dec. 2010): Results of the comprehensive quantitative impact study]. Basel III also introduces a non-risk based leverage ratio of 3 percent. According to the BCBS-QIS, a significant subset of Group 1 banks failed to meet this requirement. While the average leverage ratio of Group 1 banks is 2.8 percent, there are significant variations within this group. Obviously, the implications of the new Basel III leverage ratio depend on the
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specific situation of each institution. The EU-QIS shows an even lower leverage ratio of 2.5 percent for large institutions, leading inevitably either to a capital issuance, a reduction of exposures, or a combination of both. The potential impact of Basel III on the banking system is significant, so banks need to think these challenges through carefully in 2011. This impact will vary from institution to institution, depending upon the lines of business in which the bank is active and the geographic region in which it does business. Nevertheless it is foreseeable that, in particular, banks with an increased exposure in trading positions, a significant securitization portfolio and larger activities in derivatives, repo-style transactions and securities financing activities will suffer more than others. Due to new limits and increased asset value correlations within the new CCR framework, the overall interbank business will be penalized as well.

Furthermore, there will be higher regulatory costs for banks due to ongoing changes in regulatory requirements, which can be quite meaningful depending upon the size of the bank and the complexity of its business. The Basel III landscape is changing rapidly, with new regulations and requirements published by the corresponding national authorities almost every week; merely keeping up poses a strain on bank resources. Generally, banks will experience increased pressure on their Return on Equity (RoE) due to increased capital and liquidity costs, which along with increased RWAs will put pressure on margins across all segments. In order to become compliant with the different new Basel III requirements and, at the same time, to restore the profitability of their businesses, banks have a variety of potential measures they can take.

Since January 1, 2011 the CEBS has been replaced by the European Banking Authority (EBA) due to the new European financial supervisory framework. Note: Basel III reform requires a LCR 100% and a NSFR > 100%.

How Banks Might Respond


Figure 3: Potential responses to Basel III changes
Operational responses
Processes Methods Data Examples of operational responses RWA optimization Stricter credit approval processes

Tactical responses
Pricing Funding Asset restructuring Examples of tactical responses Risk-sensitive pricing Shift to longer-term funding Reduction of securitization exposures

Strategic responses
Business model Group organization Equity Examples of strategic responses Sale of business unit Change of holding structure

The impact of Basel III on banks calls for concentrated and reasoned actions. Apart from just attaining compliance with the new regulations, banks especially those with high internal standards and demands will go beyond compliance and take measures to restore profitability. Banks will assess their lines of business, levels of risk profiles and capital endowments as well as their funding strategies to take the right steps towards compliance and increased profitability. Numerous actions with different duration and range are available to achieve these objectives.

Reducing credit exposure and potential credit losses through stricter credit approval processes and, potentially, through lower limits, especially in regard to bank exposures Improving liquidity risk management processes including stress testing and development of contingency funding plans Fostering closer integration of risk and finance functions Integrating all subsidiaries through consistent, group-wide risk and capital management standards

extremely helpful in relieving pressure on profitability. Among tactical responses available to banks are: Adjusting lending rates, depending on competition within the specific segments and each segments strategic importance for the bank Reflecting higher capital and liquidity costs through more risksensitive pricing and performance measurement Shifting to higher-value clients with regard to profitability Shifting to less risky segments in the portfolio, with fewer securitizations, lower trading book exposures and reduced activities in areas such as derivatives, repos and securities financing Increasing the level of high-quality liquid assets Changing the mix of funding and liquidity reserves to longer-term

Operational Responses
Basel III creates incentives for banks to improve their operating processes not only to meet requirements but to increase efficiency and lower costs. Banks have already begun to examine areas such as: RWA optimization, including model refinement, process improvement, enhancement of data quality, and framework alignment

Tactical Responses
Besides the rather short-term operational responses banks have a number of more far-reaching tactical actions they can take to respond, especially to profitability concerns. We see the focus of tactical responses on the areas of pricing, funding and asset restructuring. While tactical responses by definition do not address longterm strategic issues, they may be

Figure 4: How to rebuild RoE post crisis


Accenture has analyzed the impact of the financial crisis on an exemplary banks RoE and the ways to rebuild profitability
26%

-5% -6% 3% -2% -3%


High performer RoE 20072009 Higher capital ratio DeHigher leveraging cost of funding Reduced NPL fee income provision increase Post crisis basis case Pricing optimization Effective risk management Effective customer management Strategic cost reduction Inorganic growth Post crisis strategic options

5%

1-5% To be estimated on a case by case basis

15+%

-6% 4% 1%

1%

Source: Accenture Research; In bold, levers used to quantify impact on RoE

funding, for instance by replacing interbank funding with longer-term debt and increasing the maturity of deposits Reducing total exposure, both onand-off-balance-sheet, with regard to risk and profitability

Engaging in more active client management, for instance by adjusting client segmentation and devoting more or fewer resources to clients at specific levels of size or profitability Undertaking strategic cost reductions, including rationalization of branch structures, product rationalization or implementation of a shared services model Changing the business model, which may entail selling highrisk business units, entering new product segments or businesses, or outsourcing or off-shoring non-core functions Changing the group structure, for example by selling off minority interests in financial institutions No matter what actions banks take to reach compliance with Basel III and to restore profitability, all actions should be harmonized to create an efficient approach and achieve the best possible results.

Accenture believes that, in the final analysis, even the most wellcapitalized and managed banks will experience lower profitability in the post-Basel III environment despite the range of possible responses.

Strategic Responses
In reviewing their strategic responses to Basel III and to the dangers of reduced profitability, banks have the opportunity to effect major changes throughout all areas of the institution. These include fairly straightforward initiatives such as retaining earnings to increase Tier 1 Capital but also encompass a broad range of farreaching possibilities including: Issuing new capital in light of the new eligibility criteria and phase-in arrangements Changing liquidity risk and funding strategy Taking a more active approach to balance sheet management

Potential Challenges of Basel III Implementation


Figure 5: Functional, technical and organizational challenges of Basel III implementation
Functional specification of new regulatory requirements (e.g. stress testing, limit system, risk quantification) Functional integration of new regulatory requirements into existing capital and risk management
on al
Tec

Technical implementation of new regulatory requirements Data availability and quality Technical integration into existing risk management systems (e.g. interfaces)

Fun cti

l ica hn

Implementation challenges of Basel III

Organizational Coordination of different units as well as within the group Responsibilities within implementation and beyond Availability of resources

Basel III, with its comprehensive requirements, forces banks to take a number of actions to meet the various new regulatory ratios and to restore, at least partially, their profitability. Before undertaking such actions, banks must be able to calculate and report the new ratios, requiring a huge implementation effort. Since Basel III covers a large number of areas, a thorough review of respective data and IT architecture, risk methodologies, governance structure, reporting systems, as well as the corresponding processes is needed to accomplish a successful implementation. Banks should be fully aware of these challenges as early as possible before starting their Basel III implementation. To get a better picture of the potential pitfalls we have categorized the issues as functional, technical and organizational implementation challenges (see Figure 5). The functional challenges include developing specifications for the new regulatory requirements, such as the mapping of positions (assets and

liabilities) to the new liquidity and funding categories in the LCR and NSFR calculation as well as to the stricter defined capital categories. Within the LCR the stress testing methodologies need to be specified taking into account the characteristics of the bank. Further functional challenges refer to the specification of the new requirements for trading book positions and within the CCR framework (e.g. CVA) as well as adjustments of the limit systems with regard to the new capital and liquidity ratios. Crucial is the integration of new regulatory requirements into existing capital and risk management as some measures to improve new ratios (e.g. liquidity ratios) might have a negative effect on existing figures. The technical challenges of Basel III implementation includes data availability, data completeness, data quality and data consistency to calculate the new ratios. Our experience indicates that in some cases highlighting data availability as the key criteria for calculating liquidity ratios and analyzing the completeness

of the data in the different enterprise systems and data pools can be beneficial. Further technical challenges result from the adjustments of the financial reporting system with regard to the new ratios and the creation of effective interfaces with the existing risk management systems. Compared to Basel II with its major focus on credit and operational risks, the Basel III requirements cover a wider range of topic areas including the banks capital, liquidity and risk management. In Accentures view, the key to a successful Basel III implementation is to set-up a Basel III project team that will consider the dependencies between the different topic areas and that will coordinate the different functional, technical and operating units and departments such as risk and finance as well as IT and business departments. Close cooperation will be inevitable to keep implementation costs down while providing necessary resources for compliance and for subsequent efforts to rebuild profitability. These organizational challenges need to

be managed to develop a groupwide response and also include the assignment of responsibilities both within the framework of implementation, and beyond into efforts to rebuild profitability and to allow for an integrated capital, liquidity and risk management. To achieve these objectives, identification and securing of the resources must be conducted to accomplish the full range of required initiatives. Banks that deal with Basel III effectively will establish a transparent, structured organization with clear responsibilities at all levels, with comprehensive governance for newly created models, processes, and data. They will make available sufficient resources throughout the implementation to allow for a concerted and efficient execution, and will, if necessary, create new functions to deal with matters such as asset disposal.

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How Accenture Can Help


Figure 6: Accentures Basel III approach
Our Basel Risk Management approach is modular, flexible and scalable and takes into account the specific context of each client Approach and Tools

Stage 1: Gap analysis & derivation options of action


With our project experience we can analyze your initial situation quickly and determine the project focus Our Basel III Diagnostic Tool identifies gaps between the banks situation and requirements the bank has defined regarding CRD II IV

Stage 2: Prioritization options of action & implementation planning


Create an implementation plan that respects the banks priorities and focus The Effort Estimator delivers a resilient estimation of the implementation effort Based on Business Cases we help to validate and prioritize the measures in a detailed implementation plan

Stage 3: Implementation of measures


The Accenture Delivery Method supports the planned implementation in terms of time, budget and quality parameters Project management tools, Risk and Issue Management, Progress Tracking and Status Reporting illustrate deviations from the project plan and target achievement and initiate counteractive measures Long-time project management experience in the Basel field in functional, technical and process-related areas

The demands and challenges of the Basel III implementation are both numerous and complex, and call for an efficient and structured approach to mitigate the impact of Basel III. In working with banking clients on their response to the Basel III requirements across the globe, Accenture uses a proven and target-oriented threestage approach along with our roster of dedicated tools. Our approach is modular, flexible and scalable and takes into account the specific context of each client. It allows not only for an efficient Basel III implementation but also initiates appropriate measures to mitigate the negative effects of Basel III on the bank. The first stage is devoted to an analysis of the banks current situation and to help identify the scale and focus of the project. Accenture has developed a proprietary Basel III Diagnostic Tool with a modular set-up to help identify actions necessary to meet the requirements the bank has defined for satisfying the regulations detailed in CRD II through IV, with the tool providing an efficient and effective gap analysis (see Figure 6).

In the second stage, with deviations from Basel III identified, the bank establishes priorities for immediate action while planning for implementation. The planning process takes the banks specific characteristics, as well as its own strategic priorities, into consideration. This stage also involves estimating the total Basel III implementation effort and uses business cases to verify the measures needed in a detailed implementation plan (see Figure 6). Stage one and two together build the Basel III preliminary review which is target-oriented and can be conducted with the help of our dedicated Basel III Diagnostic Tool within a few weeks, depending on the size and complexity of the banks business. During the third stage, the plan is implemented, with project planning tools used to identify and correct deviations from the project plan. With Accentures help the Basel III implementation can be effectively conducted by a dedicated team of functional and technical personnel

with extensive project management experience in the risk and banking area, using our proven project management tools (see Figure 6). Depending upon the results of the gap analysis, the overall Basel III implementation could take approximately two years (subject to the size and complexity of the bank, its current situation and IT architecture), from commencement of the preliminary review through project set-up and design, development of functional concepts, and IT implementation of necessary components for Basel III. Built into the process are regular reports on risk and issue management as well as progress tracking and status reporting. Accenture can support banks in their efforts to address the changes required by Basel III as well as to undertake measures to mitigate the adverse effects of Basel III.

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Conclusion

The new Basel III requirements expose banks across the globe to major challenges regarding their capital and liquidity requirements as well as their risk management. The revised Basel III proposals were published in December 2010 by the Basel Committee on Banking Supervision and will be phased in over the next couple of years. Identifying the necessary steps for compliance and developing a comprehensive plan to address the issues and concerns raised by Basel III are by now a significant undertaking for most banks. Accenture works with banks in a number of areas to address Basel III issues and set priorities for the near, mid- and longer term. With our extensive experience across a wide variety of aspects of risk management, and long-time project management experience in Baselrelated areas including functional, technical and process-related assignments, Accenture is wellsuited to help banks chart a course in the Basel III landscape. Accenture

brings to bear a wealth of highly experienced professionals as well as project management tools to assist in identifying the gaps to effectively implement Basel III, address risk and issue management, progress tracking and status reporting, helping identify deviations from the project plan, target achievements and initiate measures to get back on the path to completion. We believe that the real challenge for affected banks will be to build upon the actions mandated by Basel III to create stronger capital and risk structures. Banks that meet and surpass the Basel III requirements may not return to levels of profitability experienced before the global financial crisis of 2008 and 2009, but they will be in position to be well-prepared for the next crisis and achieve high performance within their industry.

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About the Authors

Michael Auer
Michael is executive principal Accenture Risk Management, Munich, responsible for German-speaking markets. Michael has 18 years of industry and consulting experience in financial services and risk management across Europe working with global institutions to transform their business and risk capabilities. His extensive experience in risk management mainly in the areas of market, credit and operational risk, risk and regulatory matters and operating models helps executives and their multinational firms become highperformance businesses.

Georg von Pfoestl


Georg is manager Accenture Risk Management. Based in Vienna, Georg has nearly 8 years of experience in the area of risk management with a focus on credit and liquidity risk, regulatory matters and Risk Weighted Assets optimization. With his experience as a banking inspector at the Austrian National Bank, his pragmatic knowledge from working with regional and international financial institutions across German-speaking markets and his technical skills pertaining to Basel II and Basel III regulatory requirements, he guides companies on their journey to high performance.

Jacek Kochanowicz
Jacek is manager Accenture Risk Management. Based in Frankfurt, Jacek has nearly 7 years of experience in risk management across Europe, the Middle East and South Africa where he worked with several regional and international institutions to improve their risk capabilities. His extensive experience in risk management, especially credit risk, asset and liability management, economic capital and stress testing helps clients become high-performance businesses.

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About Accenture Management Consulting


Accenture is a leading provider of management consulting services worldwide. Drawing on the extensive experience of its 13,000 management consultants globally, Accenture Management Consulting helps clients move from issue to outcome, with pace, certainty and strategic agility. We enable companies and governments to achieve high performance by combining broad and deep industry and functional offerings and capabilities across seven service lines: Customer Relationship Management, Finance & Performance Management, Process & Innovation Performance, Risk Management, Talent & Organization Performance, Strategy, and Supply Chain Management.

About Accenture Risk Management


Accenture Risk Management consulting services works with clients to create and implement integrated risk management capabilities designed to gain higher economic returns, improve shareholder value and increase stakeholder confidence.

Disclaimer: This document is intended for general informational purposes only and does not take into account the readers specific circumstances, and may not reflect the most current developments. Accenture disclaims, to the fullest extent permitted by applicable law, any and all liability for the accuracy and completeness of the information in this document and for any acts or omissions made based on such information. Accenture does not provide legal, regulatory, audit, or tax advice. Readers are responsible for obtaining such advice from their own legal counsel or other licensed professionals.

Copyright 2011 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

About Accenture
Accenture is a global management consulting, technology services and outsourcing company, with more than 215,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the worlds most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$21.6 billion for the fiscal year ended Aug. 31, 2010. Its home page is www.accenture.com.

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