Basel III: The Impact on Prime Brokers and Hedge Funds

This training session looks at the Basel III regulations’ impact on the banking industry and their hedge fund clients. The training provides a review of the regulations, their implications for banks and hedge funds and steps hedge funds can take to mitigate the effect of these regulations. The course is organized as follows:

SECTION 1: REGULATORY OVERVIEW

Origins of Regulations

  • Basel III
  • Dodd Frank
  • Central Banks

Overview of Key Regulations:

  • Core Equity Tier One Capital Ratio (CET1)
  • Comprehensive Capital Analysis and Review (CCAR)
  • Supplementary Leverage Ratio (SLR)
  • Liquidity Coverage Ratio (LCR)
  • Net Stable Funding Ratio (NSFR)
  • Orderly Liquidation Authority (OLA)
  • Total Loss Absorbing Capital (TLAC)

SECTION 2: IMPLICATIONS FOR THE FINANCIAL SERVICES INDUSTRY

  • Major Banks and Prime Brokers
  • Hedge Funds
  • Unintended Consequences of Basel III

SECTION 3: ACTION STEPS FOR HEDGE FUNDS

  • ROA: Pro-active Engagement with Prime Brokers
  • Evaluating Your Prime Broker Portfolio
  • Counterparty Risk Management: Incorporating Basel III Metrics

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