Market Risk -
Trading Book (FRTB).
The Fundamental Review of the Trading Book (FRTB)—a key component of Basel III reforms—has been designed to address critical weaknesses exposed during past market stress events.
Major changes include:
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Replacing Value-at-Risk (VaR) with Expected Shortfall (ES) under stress to better capture tail risk
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Tightening the boundary between the trading book and banking book to reduce regulatory arbitrage
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Introducing stricter model eligibility rules, enhanced backtesting, and more granular risk factor classification
In Europe, the implementation timeline has already been delayed to January 2027 for most FRTB components, with the Internal Models Approach (IMA) postponed to January 2028 in the U.K.
Even where timelines are extended, preparation is non-negotiable—delays are opportunities to get ahead, not to procrastinate.
How Risk Advis
Can Help
At Risk Advis, we guide banks and financial institutions through every stage of FRTB readiness, integrating strategy, risk, and technology. Our services include:
Gap & readiness assessment
Identify where your current systems, models, and data fall short of FRTB requirements.
Model & desk qualification support
Assist in preparing trading desks for Profit & Loss Attribution (PLA), backtesting, and model governance functions.
Alternative approach evaluation
Help you compare the Standardised Approach (SA), Internal Models Approach (IMA), and Simplified Standardised Approach (SSA), and steer you toward the right choice for your institution.
Data architecture & infrastructure design
Build systems capable of supporting high-frequency risk factor data, stress calibration, and real-time analytics.
Regulatory liaison & submission support
Prepare materials, manage engagement with supervisors, and align your implementation with evolving regulatory guidance.
Why Partner
With Risk Advis
Take
The Next
Step
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Deep domain expertise in market risk, regulatory capital, and risk technology
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Vendor-agnostic and practical — we don’t sell software, we deliver solutions
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Agile, boutique consulting attention with senior involvement
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Forward-looking approach — preparing you not just to comply, but to compete
Don’t wait until deadlines loom: begin your FRTB transition today.
Connect with our experts for a free diagnostic call and let Risk Advis help you transform regulatory pressure into strategic resilience.