INTM267734 - Foreign banks trading in the UK through permanent establishments: The approach in determining an adjustment to funding costs - STEP 2: Risk weighting the assets - the Basel II regulatory regime: Pillar 1 - credit risk

The credit risk component can be calculated under one of three different approaches, which have varying degrees of sophistication:

• The Standardised Approach (TSA)
• The Foundation Internal Rating Based (IRB) Approach
• The Advanced IRB Approach