Transcription of SUMMARY1 PART A: INTRODUCTION3 PART B: …
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PART A: Overview and Objective of the Role of Stress Licensed Effective Legal PART B: APPROACH TO STRESS TEST BY LICENSED Coverage and Risk Magnitude of Second-Round PART C: SPECIFIC REQUIREMENTS BY BANK NEGARA Licensed Institutions Should Conduct Own Stress Effective Board and Management Minimum Requirements for Stress Tests Conducted by Licensed Reporting to Bank Negara Appendix Appendix Appendix Appendix BNM/RH/GL 007 - 3 Jointly issued by: Financial Conglomerate Supervision Department; and Banking Supervision Department Guideline on Stress Testing Page 1/34 SUMMARY 1. The guideline reinforces the importance of stress testing as a risk management tool used to evaluate the potential effects on an institution s financial condition arising from a specific event or movement in a set of financial variables. Licensed institutions should determine their own strategies for designing and developing stress testing methods that are relevant and effective for their business environment and profile.
BNM/RH/GL 007 - 3 Jointly issued by: • Financial Conglomerate Supervision Department; and • Banking Supervision Department Guideline on Stress Testing Page 1/34 SUMMARY
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