Operational risk increased to a point that the Bank for International Settlements (BIS) required DIs to account for the risk in the capital adequacy standards under Basel II.

Question

Quizplus · Accepted Answer

This statement is true. The Basel II framework introduced in 2004 required banks to account for operational risk in the calculation of their regulatory capital requirements, as operational risk had become a significant concern after several high-profile events such as the collapse of Barings Bank due to rogue trading. The Bank for International Settlements (BIS) oversees the implementation of Basel regulations globally.

Operational Risk Increased to a Point That the Bank for International