Introduction to Risk-Weighted Assets
Moorad explains the purpose of risk-weightings, how they work and how they are assigned and applied.
Overview
Risk weighted assets are an adjustment that banks make to their loan book in order to account for the inherent default risk associated with an individual asset. There are several different approaches to assigning a rating including the regulations of the Basel Committee and a bank’s own internal process.
Key learning objectives:
Define risk weighted assets
Understand how risk weightings are assigned
Summary
Expert
Moorad Choudhry
Former senior banker with almost 30 years experience. Moorad has held senior roles in commerical, investment and retail banking. He has also spent the last five years as a visiting professor.
