Advanced Measurement Approaches (AMA)
Advanced Measurement Approaches (AMA) is a term used in the banking industry, specifically in relation to the measurement and management of operational risk. Operational risk refers to the risk of financial loss resulting from inadequate or failed internal processes, people, systems, or external events. AMA is an approach for calculating regulatory capital requirements for operational risk under the Basel Framework, specifically Basel II and Basel III. It is an alternative to the simpler standardized approaches and allows banks to use their own internal models to estimate their capital needs for operational risk.