Supervisory Guidance: Supervisory Review Process of Capital Adequacy (Pillar 2) Related to the Implementation of the Basel II Advanced Capital Framework

This collection relates to interagency guidance regarding the supervisory review process for capital adequacy (Pillar 2) provided in the Basel II advanced approaches final rule. The supervisory review process described in the guidance outlines the agencies' expectations for (i) satisfying the qualification requirements provided in the advanced approaches final rule; (ii) addressing the limitations of the minimum risk-based capital requirements for credit risk and operational risk; (iii) ensuring that each institution has a rigorous process for assessing its overall capital adequacy in relation to its risk profile and a comprehensive strategy for maintaining appropriate capital levels; and (iv) encouraging each institution to improve its risk identification and measurement techniques. The supervisory guidance applies to an institution implementing the advanced approaches final rule.

The latest form for Supervisory Guidance: Supervisory Review Process of Capital Adequacy (Pillar 2) Related to the Implementation of the Basel II Advanced Capital Framework expires 2023-11-30 and can be found here.