International banking prudential standard-setter, whose standards indirectly influence insurance and reinsurance.
The Basel Committee on Banking Supervision is the international prudential standard-setting body for the banking sector, hosted by the Bank for International Settlements. It develops the Basel accords, successive frameworks defining banks' capital, liquidity and risk-management requirements, then adopted by member jurisdictions. Although dedicated to banking, the Basel Committee is of interest to insurance on several counts: its risk-based capital concepts inspired insurance regimes, its market and credit risk standards concern bancassurers and financial conglomerates, and the comparison between banking and insurance regulation illuminates systemic risk debates. The Basel framework differs markedly from Solvency II, however, in the nature of risks covered: bank liabilities are short-term callable, whereas insurance liabilities build over the duration of contracts. For the observer, understanding Basel helps situate the specificities of the insurance prudential regime.
The risk-based capital concepts popularised by the Basel accords influenced the design of insurance prudential regimes such as Solvency II.
Comité de Bâle, BCBS, Basel Committee, accords de Bâle