Banks Face Basel Clampdown on Risk-Model Variation
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Global regulators are preparing to narrow banks’ options for assessing credit risk in a bid to prevent the understatement of possible losses.
The Basel Committee on Banking Supervision will publish a report by early November on “excessive” variability in the models banks use to assign risk and measure capital needs, Secretary General Bill Coen said in an interview at the regulator’s headquarters in Basel, Switzerland. The document has been prepared for the Group of 20 nations.