Sweden’s Banks Conceal Mortgage Risks Borg Pledges to Lay Bare
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Sweden’s banks, Europe’s safest on paper, have been hiding mortgage-asset risk behind rules the government now says are out of date and too lax.
Finance Minister Anders Borg said yesterday he wants banks to raise the risk weights on their mortgage assets as a next step to enforcing some of the world’s highest capital ratios. Stricter risk-weight requirements could add as much as 2.5 percentage points to reserve requirements, the central bank estimates.