Delay in implementing Basel 2 regulations

BANKING: The asian banking sector is oversaturated said Senior Director Capital Markets and Regulatory Compliance -Industries of Oracle Corporation Asia Pacific Dr Chris Marshall.

'Some countries have it mandatory for banks to be Basel 2 compliant by 2007. But some governments delay implementing Basel 2 regime.

The Central Bank of Sri Lanka has not made it mandatory to comply with the Basel 2 yet and the Sri Lankan banking sector is not mandated to meet the deadline of 2007', he said.

Basel 2 will push the banking sector to improve their management and change the landscape of the banking industry.

Though this is a complicated procedure it will speed up the consolidation of the industry. This will also double the advantages for large banks through risk management, Marshall said.

Oracle will help the Sri Lankan banking industry when the industry reverts to Basel 2 regime through their latest technology and applications. Basel 2 represents a major revision of the international standard on bank capital inadequacy. It aligns the capital measurement framework with sound contemporary practices in banking, promotes improvement in risk management and is intended to enhance financial statibility.

Oracle organised a seminar for the local banking industry to educate them on Basel 2 and its importance to the local banking industry recently. (AS)