Purpose: Description of the bank’s strategy and how senior management and the board of directors assess and manage risks, enabling users to gain a clear understanding of the bank’s risk tolerance/appetite in relation to its main activities and all significant risks.

Scope of application: The template is mandatory for all banks. [Throughout this document, "All banks" in the scope of application fields is used to refer to all banks subjected to Pillar 3 of the Basel framework, in accordance with paragraph 4 on scope of application above.]

Content: Qualitative information.

Frequency: Annual

Format: Flexible

Banks must describe their risk management objectives and policies, in particular:

(a) How the business model determines and interacts with the overall risk profile (eg the key risks related to the business model and how each of these risks is reflected and described in the risk disclosures) and how the risk profile of the bank interacts with the risk tolerance approved by the board.