ECB Supervisory Board vice-chair with scheduled speech 29 Jan
- Basel accord gaps can be filled with earnings
Oh really?
Says Sabine:
It is done: Basel III has been finalised.
I admit that it was a long journey, but in my view, it was worth the wait: Basel III will help to make banking safer. It is crucial, though, that Basel III is properly implemented - in Europe and around the world. It must not be watered down.
Basel III marks the end of the post-crisis reforms; regulatory certainty has been restored. The banks know what awaits them; they can be confident about the regulatory framework, and can plan ahead and support the real economy.
But does Basel III deliver what was promised? Does it, on the one hand, create rules which are sufficiently risk-sensitive to set the right incentives for banks? And does it, on the other hand, create rules which are simple enough to decrease model risk?
Banks are not enchanted by Basel III. Many of them claim that it throws risk sensitivity overboard and penalises low risk exposures. Are these claims justified?
Oooooooh the excitement is building.
The full speech entitled Basel III -Sense and Sensitivity published here
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