Capital Management Structure

In June 2011, the National Monetary Council, through the Brazilian Central Bank, issued Resolution 3988, which defines the capital management policy and implementation of the capital management structure in financial institutions obliged to calculate its Risk-Weighted Assets (RWA).

At Banrisul, Capital management is an ongoing capital monitoring and control process. The evaluation of capital needs to face the risks to which the institution is subject; and the planning of capital needs and targets, in line with the institution’s strategic goals.

The capital management structure envisages:

  • Procedures allowing the identification and evaluation of material risks incurred by the institution;
  • Policies and strategies for Capital management through the procedures aimed at keeping the Capital consistent with the risks incurred by the institution;
  • Procedures for calculating the total Risk Weighted Assets (RWA);
  • Procedures for calculating the required reference capital;
  • Procedures for calculating the capital adequacy ratio and defining the minimum limits;
  • Procedures for preparing a capital plan;
  • Conducting stress tests of severe market events and extreme market conditions and evaluating their capital impact;
  • Preparing periodic management reports on capital adequacy.

According to the current legislation, the Capital Management activity can be performed by a single department, responsible for managing the capital of the Financial Conglomerate and assessing potential impacts on capital arising from risks associated with non-financial companies, members of the Economic-Financial Consolidated.

At Banrisul, the Banrisul Group Capital Management (Banco do Estado do Rio Grande do Sul S.A., Banrisul Armazéns Gerais S.A., Banrisul S.A. Administradora de Consórcios, Banrisul S.A. Corretora de Valores Mobiliários e Câmbio, Banrisul Cartões S.A.) is carried out by the Corporate Risk Management Unit.

Below is the capital management structure:

Responsibilities within the Structure of Capital Management

The Board of Directors is responsible for the information in the public report, containing the description of the Capital management structure, as well as the approval of the responsible Officer and the structure.

Chief Risk Officer shall ensure that the capital management process assess, monitor and control the available capital of the Financial Conglomerate and maintain communication with the directives bodies and regulators, as well as enforce the policy guidelines of the Institutional Management Capital.

The Corporate Risk Committee, besides approving methodologies applied in measuring risk; should ensure the implementation, strategic management and approving of policies for risk management of credit, market, liquidity, operational and capital risk.

The Corporate Risk Management Unit is responsible for coordinating the capital management process developed by the Credit Risk and Capital Management Area.