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Article: Basel II: Capital Accord Or Capital Discord? - Preparations For The New Capital Accord Trundle On But There Are Growing Fears Among Bankers And Their Supervisors That Its Inconsistent Implementation Around The World Will Cause Problems. Michael Imeson Rep.(industry regulations)
- Article from:
- The Banker
- Article date:
- March 1, 2006
- Author:
CopyrightCOPYRIGHT 2006 FT Business. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Byline: MICHAEL IMESON
The Basel II Capital Accord is in danger of becoming a sad case of banking discord. Drawn up by the Basel Committee on Banking Supervision to replace Basel I, the intention of the accord is to encourage internationally active banks to align their capital more closely to the risks they face.
Banks and banking supervisors agree that a new capital adequacy agreement is necessary. The accord was published by the Basel Committee in 2004 and updated last November. Subject to possible fine-tuning, it should start coming into effect on January 1, 2007. The problem is that this supra- national agreement gives so much latitude to individual ...