FCG has advised Resurs Bank in the application process for being able to measure its operational risks through the Alternative Standardised Approach
Today, Resurs is a leader in the growing Nordic consumer credit market, with slightly more than six million customers in its customer database. Resurs bank is a Swedish bank which mainly focuses on unsecured lending and retail finance. Resurs bank is a subsidiary to Resurs Holding and has roots back to 1977.
Resurs Bank has experienced an ever-increasing number of regulatory updates that have entered into force since the financial crisis in 2008 which has put a lot of pressure on them. Resurs has dealt with this issue by utilizing FCG’s quarterly monitoring of new regulations both short and long term. Resurs bank has been using the Standardized Approach for calculating operational risk and were looking for alternatives methods that better reflects their actual exposure to operational risk. Resurs bank sought out FCG to help it navigate the application process for being able to measure its operational risks through the Alternative Standardised Approach.
Change in method of calculation for Operational risk
FCG aided Resurs in the application to calculate the capital requirement for operational risks using the Alternative Standardised Approach, according to article 319 in Regulation (EU) 575/2013. The Financial Supervisory Authority approved Resurs’ application to change the method for measuring the capital requirements for operational risks from the Standardised approach to the Alternative Standardised approach without any follow-up questions.
Using the new method of measurement Resurs has increased its total capital ratio from 15.8% to 17.2%, keeping in mind the regulatory requirement of 13.5 %
The Tier 1 Capital ratio for Resurs was raised from 14.2% to 15.4% compared to the regulatory requirement of 9.1 percent, previously 9.0 percent.
Result
Resurs bank has through the help of FCG managed to increase its capital ratios and measure its operational risks more accurately. It can rest easy knowing their financials have strengthened with the new Alternative Standardised Approach when calculating the capital requirement for operational risks. They can now focus on their core business and adding value to their customers.
Read more here:
Press release from Resurs Bank AB: Resurs Bank AB har fått godkännande att byta metod för att beräkna kapitalkravet för operativ risk
DI: Resurs Banks kapitalsituation stärks efter att FI godtagit ny metod
