Advanced Approach definition
Advanced Approach means that institutions use own estimates of LGDs and/or EADs and are required to take into account the effective maturity of its facilities.
Advanced Approach institutions. This means that the bank is now subject to the supplementary leverage ratio and has to use both the standardized approach as well as the model-based advanced approach to calculate risk based capital measures. In addition, these banks are subject to the full LCR, which requires HQLA sufficient to cover 100% of the 30 day cash outflow. Advanced approaches banks are also expected to be subject to the full NSFR.