What It Is

Basel III is the post-GFC global regulatory framework by the BCBS for bank prudential standards. It strengthens capital quality and quantity, introduces leverage constraints, and mandates liquidity buffers to address crisis vulnerabilities. The approach combines risk-weighted assets with simple non-risk-based metrics for comprehensive resilience.

Key Components

• **Pillar 1Capital ratios (CET1 4.5%, Tier 1 6%, Total 8% of RWA), buffers (conservation 2.5%, countercyclical, G-SIB), leverage ratio 3%, LCR and NSFR at 100%.
• **Pillar 2Supervisory review via ICAAP and stress testing.
• **Pillar 3Standardized disclosures for RWA comparability and leverage. No formal certification; enforced through national laws.

Why Organizations Use It

Banks implement for mandatory compliance in jurisdictions, reducing systemic risk, enhancing loss absorption, constraining leverage, and improving market discipline. Benefits include greater resilience, better funding costs, and strategic balance-sheet optimization amid supervisory scrutiny.

Implementation Overview

Phased enterprise transformation: gap analysis, data architecture upgrades, model constraints, governance setup. Targets internationally active banks globally; involves ongoing reporting, disclosures, and supervisory interactions. (178 words)

What It Is

SAMA Cyber Security Framework (SAMA CSF) is the Saudi Central Bank's mandatory regulatory framework for cybersecurity in financial institutions. It provides a principle-based, risk-driven approach aligned with NIST, ISO 27001, PCI DSS, and Basel standards, mandating minimum Maturity Level 3 across all regulated entities.

Key Components

• Four core domains: Cyber Security Leadership and Governance, Risk Management and Compliance, Operations and Technology, Third Party Cyber Security.
• 114+ sub-controls organized into subdomains with principles, objectives, and control considerations.
• Six-level Cyber Security Maturity Model (0: Non-existent to 5: Adaptive), requiring structured policies, standards, procedures, KPIs, KRIs, and continuous improvement.
• Self-assessments and SAMA audits for compliance verification.

Why Organizations Use It

• Mandatory for banks, insurers, financing firms, credit bureaus, and fintechs to avoid fines, license risks, and reputational damage.
• Enhances resilience, enables multi-framework reuse, and supports Vision 2030 digital goals.
• Builds stakeholder trust through board accountability and proven incident reduction.

Implementation Overview

• Phased roadmap: gap analysis, governance setup, control deployment, monitoring.
• Targets mid-to-large financial firms in Saudi Arabia; 6-12 months typical.
• No external certification; relies on periodic self-assessments and SAMA reviews.