Topic Own funds Reform of the Basel framework
Article from the Annual Report 2016 of the BaFin
The member states of the Basel Committee on Banking Supervision (BCBS) are negotiating the finalisation of the Basel III reform agenda. Its key aspect is a review of global banking regulation, which in BaFin's opinion should also reflect the various national market structures and business models of the banks, despite its high level of detail. The crucial meeting of the Group of Central Bank Governors and Heads of Supervision (GHOS), originally planned for early January 2017, has been postponed, because some last important details still had to be clarified. The issue in question is the design and level of an output floor intended to limit the variability of risk-weighted assets (RWA) when using internal models. From BaFin's point of view, the aim has to be to find an acceptable global compromise and thus bring Basel III to a successful conclusion.1 However, a compromise at any price is, in the opinion of BaFin's President Felix Hufeld, not an option. He believes that it is correct to limit the risk sensitivity of the Basel framework and therefore also the use of internal models in a reasonable way. "But we are not prepared to, de facto, relinquish risk sensitivity as a regulatory principle."
Footnote:
- 1 No results were available at the time of going to press.
