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IFRS9 & BaSel III and BankIng SyStem(challengeS & oppoRtunItIeS)

dR. youSeF padganeh tehRan, may 2016

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FInancIal cRISIS

ImF dIRect

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• The banking system needs to be able to effectively channel credit to the private sector. This will require addressing the high levels of nonperforming loans, bolstering bank capital, restructuring weak institutions, dealing with unlicensed financial institutions, and strengthening risk management systems and bank supervision. (IMF – DAVID LIPTON – 17/05/2016)

• The complexity and severity of the challenges facing the banking system require immediate action. (IMF)

فرارو. (استترين و بزرگ ترين مشکل اقتصاد ايران نظام بانکي مهم :جمهوردکتر مسعود نيلي مشاور اقتصادي رئيس(

IRanIan BankIng SyStem

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IFRS9 & BaSel III and BankIng SyStem

The latest IFRS 9 guidelines pose significant challenges to financial institutions for adoption of the new standard by January 2018 and recommended parallel run during 2017.

The retail, corporate, and investment banking segments will be affected [by BASEL III] in different ways. Retail banks will be affected least, though institutions with very low capital ratios may find themselves under significant pressure. Corporate banks will be affected primarily in specialized lending and trade finance. Investment banks will find several core businesses profoundly affected, particularly trading and securitization businesses. Most banks with substantial capital markets and trading business will likely face significant business-model challenges in the next few years. (McKinsey) .

The year 2018 & 2019 will be a challenging time for banking system globally,

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SomewheRe oveR the RaInBow

FIco

BaSel III

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IRanIan BankIng SyStem: caR vS. nplS

ImF & cBI

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caR vS. nplS

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BaSel III - taRget caR

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BaSel III - RegulatoRy capItal Impact

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BaSel III - RegulatoRy Impact

(http://www.BaIn.com)

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Increase loan loss provision; Increase cost of capital; Increase loan pricing; Closing the gap between

Risk and Finance; Needs sophisticated models; Through the cycle valuation.

IFRS 9 FRamewoRk & key FeatuReS

(kpmg- adopted)

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IaS 39 to IFRS9: a BIg ShIFt

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IFRS9 - Road map and key paRtIeS

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not only FInancIal RepoRtIng

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BaSel III & IFRS9 Impact

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oppoRtunItIeS Lead to a stable financial system. Support sustainable growth. Easy access to capital and money market. Lower cost of borrowing.

challengeSThe new IFRS9 standard will have a massive impact on how banks account for credit losses on their loans portfolio.(Moody’s, S&P, E&Y, McKinsey)Increase regulatory capital requirements.Increase cost of capital.Decrease profitability.Increase cost of funds – Basel III requires more stable funds in short and long term.Data quality and availability.Lack of expertise.

انکي قدرتمند استانداردها جهاني حداقل خواسته ها براي استحکام يک نظام بانکي هستند ، پس براي دستيابي به نظام ب. مورد انتظار اقتصاد مقاومتي، آنها را کف آرزوها و نه سقف آرزوهاي خود قرار دهيم

»ما مي توانيم«

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