Prudentiality and Regulations of the Romanian Banking System
The economic crisis has affected all types of banking products and services, business models, monitoring and evaluation methods known. In the banking industry the term „banking and prudential regulations” is increasingly used to highlight the need for regulations to ensure the legal framework for the conduct of the banking activity and that would establish responsible relations between banks and customers. The need for a prudential attitude imposed on the banks by the law derives primarily from the role of the banks and of the banking system in the economy.
The Romanian Banking Institute launches in the banking market a training program for the members of the management bodies and holders of key positions in a credit institution in order to satisfy the requirements formulated by the National Bank of Romania regarding the authorization of the credit institutions, Romanian legal individuals and Romanian branches of the credit institutions from third countries as amended and supplemented (NBR Regulation no.11/2007).
The program was conceived as a result of the document recently sent by the European Banking Authority for public consultation, entitled Guidance for analyzing the level of adequacy of the members of the management bodies and holders of key positions within a credit institution or of those running to occupy such a position. The provisions from the proposed Guide correspond also to the proposal of Directive of the European Commission regarding the activity of the credit institutions and prudential supervision of the credit institutions and of the investment societies (CRD IV).
The program aims: to offer to the participants an information/training program focused on the presentation and discussion of the NBR regulations by using training models that impose high professional standards on the transition from one stage to another throughout the career path in the banking field and maintaining them through a continuing professional education. The program has an interactive character and the participants have the possibility of dialogue and exchange of experience.
Target group: the persons nominated to exercise managerial responsibilities within the bank or its organizational structures, including from the perspective of the complexity degree, for the activity to be done within the bank.
The structure of the program was made according to the attached bibliography. The course is divided into modules:
Part I Risk Management
- Overview of regulatory requirements/challenges for banks in Romania
- Basel III/CRD IV requirements (EU Directive no 36/2013, Romanian Banking Law – GEO no 96/2006, EU Regulation no 575/2013, NBR Regulation no. 5/2013, EBA guidelines)
- Recovery plan (measures, indicators, scenarios, critical functions, critical shared services) – Romanian Law no. 312//2015
- Resolution plan (resolutions objectives and measures, MPE vs. SPE resolution strategies, data/information to be delivered to the Resolution Authority) – Romanian Law no. 312//2015
- SREP methodology used by BNR for assessing the bank & establishing the capital requirements
- Main prudential indicators of the Romanian banking system
- NBR Regulation no 5/2013 on prudential requirements for credit institutions
- Definitions of risks
- Risk profile, risk appetite, risk tolerance of banks
- Requirements on risk management activities. Risk management function. Risk culture. Internal control functions.
- Specific requirements for managing main types of risks (credit, market, operational etc.)
- Stress tests (types, coverage, main requirements)
- Outsourcing requirements
- Basel III/CRD IV – main elements and calculation methods
- Main new elements brought by Basel III/CRD IV
- Short introduction on risk weighted assets (RWA) and capital requirements;
- Changes brought by Basel III/CRD IV in calculating RWA;
- New liquidity risk ratios (LCR & NSFR)
- Leverage ratio
- Internal Capital Adequacy Assessment Process (ICAAP)
- NBR requirements regarding ICAAP/Pillar 2
- Structure of ICAAP/Pillar 2 (risk materiality assessment, risks/economic capital measurement, economic capital adequacy, limits, concentration management, stress test, risk planning)
- Economic capital measurement: main methods used by Romanian banks
- Internal capital; types of risks covered by internal capital
- Case Study
- Other prudential ratios/requirements. New IFRS 9 provisions
- Large exposures
- Exposures to the group of people affiliated to the credit institution
- Operations under favorable conditions/non-arm length transactions
- New IFRS 9 provisions:
- expected loss model
- risk parameters used
- comparison of parameters used for IFRS 9 vs. Basel
- unwinding etc.
Lecturer: Arion Negrilă, PhD; Delivery mode: 2 sessions of 2 hrs each
PART II Corporate Governance of credit institutions
1. The organisational structure of a credit institution
- Organizational framework;
- Verifications and balancing within a group structure;
- Knowing the structure;
- Unusual activities or activities which lack transparency.
2. The management of a credit institution
- Atributions and responsabilities of the managing body;
- Management structure and function;
- The role and responsabilities of the specialized committies of the managing body;
- The general framework for managerial activities.
3. Internal control.
4. Remuneration policies and practices.
5. Information systems and business continuity.
7. Conditions for the externalization of certain activities within credit institutions.
Lecturer: Doru Bebe Bulată, ICA, ACAMS; Delivery mode: 3 sessions of 2 hrs each
Arion Negrilă, PhD.
Starting with February 1, 2021, Arion is Director of the Compliance Department in BCR. previously holding the positions: Executive Vice President Risk (CRO) – BCR Housing Bank, Senior Advisor to BCR Executive Vice President Risk (CRO), and Senior Executive Director – Risk in BCR. Between 2004 and 2014, he held the position of Executive Director of the Risk Controlling Division in BCR.
Since 2011, Arion holds a PhD in Economics – his thesis was on „Risk Management – important condition for high performing activity”. He also holds a Bachelor Degree in Economics (Academy of Economic Studies – Faculty of Finance, Banks and Accounting, Finance and Banks Department). Arion has attended numerous training courses on risk management and general management (Executive Development Program, organized by HEC University of Montreal, Canada, Academy of Economic Studies – Post-academic studies on bank and stock exchange management, several courses organized by Georgetown University – USA, ATTF Luxembourg, UBS Warburg – Switzerland etc.). Arion is an experienced associate lecturer at RBI, on issues related to banking risks.
Doru Bebe Bulată, ICA, ACAMS
Doru, graduate in law, is a member of the Boards of Directors of Transfond SA and Banca Românească SA, a member of the Supervisory Board of the Three Seas Initiative Investment Fund (FI3M) – Luxembourg and Senior Advisor of EximBank Board of Directors on topics of Corporate governance, Risk and Compliance.
He is the RAB representative within the European Federation of Banks and for 14 years he was President of the Compliance Commission within the Romanian Association of Banks (RAB). His expertise and experience in Corporate Governance, in the implementation of a coherent and effective framework of governance principles relies on his professional career, built both within top financial institutions and in international organizations. He has a rich experience in internal control and corporate governance, gained during his career as Head of Compliance in BCR, member of ONPCSB plenum, member of the Board of Directors of R.A. State Monetary, Romania’s representative in the Council of Europe – Moneyval Committee and member of EDMONT Group. His professional experience is validated by numerous international certifications, such as: Diploma in Compliance – ICA & University of Manchester, UK; Certified AML Specialist – ACAMS, USA. Mr. Bulată is an associated lecturer of RBI since 2005 and he is also a certified trainer and evaluator of professional competences.
Schedule of program
The coaching programme will take place during two weeks, with a total of 10 hours, as follows:
Module A – 4 hours
Module B – 6 hours
The course will be organized open for a minimum of 6 participants; upon request, at the premises of the beneficiary, within a one-to-one program (coaching) or online.
The programme will held in English if people of other nationalities (expats) will attend the course, and otherwise it will be held in Romanian.
For the course fee and other details please contact us by phone or e-mail.