Pooled resources offer way to keep credit models afloat
Supervisors drive banks to seek more corporate default data and cost-effective model improvements
Banks that model their own credit risk capital requirements are being squeezed on both sides. Supervisors want them to work harder, while the rewards available – in terms of capital relief relative to the cruder standardised approach – are shrinking.
This is a problem not only for banks but also for European regulators who fought to save the internal ratings-based approach from their sceptical peers. As a result, a new attitude is starting to emerge on both sides of the divide. Instead of a
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Regulation
Former NY Fed chief calls for overhaul of discount window
Dudley’s proposed changes include prepositioning collateral, cutting costs of secondary credit facility
Trends in regulatory enforcement in the age of compliance angst
Legal and compliance experts discuss the changing shape of regulatory enforcement and how financial institutions are adapting to a shift in approach
US climate guidance stokes debate over defining material risks
Banks welcome flexibility, but it could lead to big divergence on climate risk management
Levelling the playing field for stablecoins
Regulatory asymmetries are a barrier to innovation in digital payments
Review of 2023: A hard road to a soft landing
Banks and regulators were caught in the crosswinds of the fight against inflation
Climate capital in the balance as EBA rejects green risk weights
European regulator suggests climate change must be factored into existing risk categories
FRTB could put Indian banks at competitive disadvantage
Simplified approach could leave local banks with higher capital charges than foreign branches