In the comprehensive example, when we consider haircut applied on the exposure (He), this should be the haircut applicable for the type of loan this bank has extended, right? The loan for which we are computing the capital charges. And the haircut applicable on the collateral value is ofcourse dictated by the collateral type.
Hello there, thanks. May I have one question: what if the collateral value (C) exceeds the exposure value (E) i.e. C =$50 > E=$40. What would be the RWA for such a case?
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Fabulous. Thanks for putting this resource up on youtube.
easy to understand. Really appreciate your work.
So if there is no collateral then also we have to use the first part of the equation max(0, [E*(1+Hx)]
In the comprehensive example, when we consider haircut applied on the exposure (He), this should be the haircut applicable for the type of loan this bank has extended, right? The loan for which we are computing the capital charges. And the haircut applicable on the collateral value is ofcourse dictated by the collateral type.
Thanks to you, everything is getting clear!
tTAHK YOU SIR..EXPECTING MORE..
Great video! Thanks.
Very good for to explain Credit Risk Mitigation...
Fabulous..!! but how or what factors decide to choose between simple and comprehensive method..??
That's really helpful
Hello there, thanks. May I have one question: what if the collateral value (C) exceeds the exposure value (E) i.e. C =$50 > E=$40. What would be the RWA for such a case?
Koy Socheat add haircut and calculate as formula
thank u