(Syllabus) IIBF: Certified Banking Compliance Professional Course

Syllabus for online examination

The details of the prescribed syllabus which is indicative are furnished in this booklet. The Institute however, also reserves to itself the right to vary the syllabus / rules / fee structure from time to time. Any alterations made will be notified.

Paper-I : Risk, Regulation & Governance

Module-A : An overview

a) Risk definition / policies

Risk Process-Risk Organization - Key risks-Credit risk, market risk, operational risk, liquidity risk, legal risk, interest rate risk and currency risk

b) Asset Liability Management

ALM Concept - ALM organization - ALCO techniques / tools - Simulation, Gap, Duration analysis, Linear and other statistical methods of control

c) Risk measurement & Control

Calculation - Risk exposure analysis - Risk management / mitigation policy - Risk immunization policy / strategy for fixing exposure limits - Risk management policy and procedure - Risk adjusted return on capital - Capital adequacy norms

d) Risk management

Capital adequacy norms - Prudential norms - Exposure norms - Concept of Mid office - Forwards - Futures - Options - Strategies and Arbitrage opportunities - Regulatory prescriptions of risk management

Module-B : Credit Risk Management

Introduction - Basel-I - Three pillars of Basel-II and Capital for Operational risk - Frame work for risk management - RBI guidelines on risk management

- Risk rating and risk pricing - Methods for estimating capital requirements - Credit risk - standardized approach - Credit risk - advanced approach - Credit rating / credit scoring and rating system design - Credit Bureaus - Stress test and sensitivity analysis - Internal Capital Adequacy Assessment Process (ICAAP) - Introduction to structured products

Module-C : Operational Risk

Introduction, Basel-I & II - RBI guidelines - Likely forms of operational risk and causes for significant increase in operational risk - Sound Principles of Operational Risk Management (SPOR) - SPOR - organizational set up and key responsibilities of ORM - SPOR - policy requirements and strategic approach for ORM - SPOR identification, measurement, control / mitigation of operational risks - Capital allocation for operational risk, methodology, qualifying criteria for banks for the adoption of the methods - Computation of capital charge for operational risk

Module-D : Market Risk

- Introduction and definition - Prescriptions of Basel-I & II - Liquidity risk - Interest rate risk - Foreign exchange risk - Price risk (Equity) - Commodity risk
- Treatment of market risk under Basel

a) Standardized duration method
b) Internal measurement approach - VaR

Basel-III guidelines

- Risk Management Policy - ALCO structure and functions.

Paper-II : Compliance in banks

Module-I : Regulation and Regulatory framework

1) Need for regulation in banks; importance of regulation, the role of regulators, the instruments of regulation, regulatory models, regulatory authorities.

Module-II : Compliance programme

1) Compliance Risk and significance of Compliance Function; Compliance Policy; Compliance principles, process and procedures; Steps taken by Banks for compliance; Scope of compliance function; The Compliance Programme

2) Compliance governance structure; Organizational structure; Responsibility of the Board and Senior Management; Compliance structure at corporate office; Functional departments; Field level; Internal controls and its importance

3) Compliances issues; Compliance Risk; Inherent risk and Control risk; Independent testing and effective audit programme; Reporting Framework and Monitoring compliance, Reporting of breaches / non-compliances observed; Role of Audit and Inspection; Essentials for good compliance

4) Creating compliance culture across the organization; Governance, risk and compliance - GRC framework; Benefits of Taking an Integrated GRC Approach; Whistleblower mechanism; The Components of a Whistle-Blower Policy; Reasons for compliance failures

Module-III : Regulatory compliances

1) Disclosures in Financial statements of Banks; Disclosure Requirements; Capital; Repo Transactions, Investment Portfolio; Derivatives; Asset Quality; Asset Re-construction, Business Ratios; Asset Liability Management; Accounting Standard; Disclosures relating to Securitisation

2) Exposure norms; credit exposure to individuals / groups; exposure to certain industries; exposure to capital markets; exposures to joint ventures abroad

3) Computation of CRR / SLR

4) Capital adequacy, Basel II, Basel III

5) KYC / Anti-Money Laundering guidelines

Module-IV : Statutory, Regulatory Restrictions and Guidelines on Loans and Advances

1) Statutory, Regulatory restrictions on certain sectors
2) Priority sectors and MSME
3) Interest rates on advances
4) NPAregulations

Module-V : Foreign currency operations under FEMA and other regulations

1) Investment in India and abroad
2) Guidelines for exports
3) Guidelines for External commercial borrowings (ECB)
4) Money changing, Miscellaneous Remittances from India - Facilities for Residents; Remittance Facilities for Non-Resident Indians / Persons of Indian Origin / Foreign Nationals; Risk Management and Inter-bank Dealings
5) Guidelines for import of goods and services
6) Deposit accounts for NRIs; Memorandum of Instructions for opening and maintenance of Rupee / Foreign Currency / Vostro Accounts of Non-resident & Exchange Houses

Module-VI : Guidelines for customer service

1) Customer Service Committee of the Board; Role of the Customer Service Committee; Board approved policies on Customer Service, government business, Frauds
2) Financial distribution : Insurance, Mutual funds
3) Alternate delivery channels : credit / debit cards; smart cards; NEFT; RTGS