Regulator Wants to Curb Bank’s Leeway to Calculate Risk, FTD

The Basel Committee on Banking Supervision may require banks to apply a standardized format to calculate their credit default risks in addition to internal valuation models in order to meet their capital requirements, Financial Times Deutschland reported.

This would prevent banks understating their capital needs as both set of numbers would be published and show how much capital a bank saves when using an internal model, the FTD said, citing an interview with the Wayne Byres, secretary general of the committee.

To contact the reporter on this story: Annette Weisbach in Frankfurt at aweisbach1@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net

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