Basel Committee looks into simplifying regulation

The Basel Committee on Banking Supervision is looking to allay concerns that the Basel III framework is too complex, and it is examining the comparability of capital adequacy ratios across banks and jurisdictions.

  • By Will Caiger-Smith
  • 08 Jul 2013
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In a discussion paper published on Monday, the Committee said it was committed to Basel III reforms but wanted to gather feedback from market participants on how it could simplify the framework. 

Basel III’s focus on risk sensitivity and the specific circumstances of different institutions has led to increasing complexity in regulation — which “entails a number of potentially adverse consequences”.

Simplifying Basel III where possible and improving the comparability of capital ratios between institutions — for example by stopping banks from using their own internal models to calculate risk-weighted assets — is important to ensure the regulatory framework is fit for purpose, said the Committee.

Explicitly recognising simplicity as an additional objective in the Basel capital adequacy framework could help achieve this goal. 

Enhancing disclosure standards for banks and using additional metrics to measure solvency — rather than just relying on RWA-based capital ratios — would make it easier to truly compare different institutions,

The multidimensional risks and diverse instruments banks are exposed to makes it difficult to simplify the framework, however. So do differing interpretations of certain terms, which could lead to additional criteria being published in certain areas, it said.

Banks should provide a range of options to measure capital requirements, which also makes simplicity challenging, said the Committee.

The use of risk models and the “possibility that indicators may lose their predictive power when relied on for regulatory purposes” also makes it difficult to find a common ground between simple regulation and a framework which takes into account the multidimensional nature of risk in complex banking organisations, the paper said.

Feedback on the discussion paper must be submitted by Friday October 11 this year. 

  • By Will Caiger-Smith
  • 08 Jul 2013

Bookrunners of Global Covered Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 16 May 2017
1 HSBC 5,680.75 25 5.91%
2 Commerzbank Group 5,001.67 29 5.20%
3 UniCredit 4,986.06 37 5.19%
4 Credit Agricole CIB 4,573.35 20 4.76%
5 BNP Paribas 4,463.32 18 4.64%

Bookrunners of Global FIG

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 22 May 2017
1 Morgan Stanley 139,173.11 554 6.60%
2 JPMorgan 135,505.56 612 6.43%
3 Citi 127,910.15 757 6.07%
4 Goldman Sachs 125,520.43 675 5.95%
5 Bank of America Merrill Lynch 119,876.60 536 5.69%

Bookrunners of Dollar Denominated FIG

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 25 Apr 2017
1 JPMorgan 104,210.95 417 10.23%
2 Citi 99,111.89 557 9.73%
3 Bank of America Merrill Lynch 94,929.57 429 9.32%
4 Morgan Stanley 89,025.14 390 8.74%
5 Goldman Sachs 85,770.72 496 8.42%

Bookrunners of Euro Denominated Covered Bond Above €500m

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 09 May 2017
1 SG Corporate & Investment Banking 3,864.50 15 8.19%
2 LBBW 3,506.91 13 7.43%
3 Credit Agricole CIB 3,308.89 13 7.01%
4 BNP Paribas 2,845.56 10 6.03%
5 Commerzbank Group 2,832.12 11 6.00%

Global FIG Revenue

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 02 May 2016
1 Morgan Stanley 365.83 497 7.62%
2 JPMorgan 332.66 618 6.92%
3 Bank of America Merrill Lynch 299.89 590 6.24%
4 Goldman Sachs 276.71 375 5.76%
5 Citi 264.54 592 5.51%

Bookrunners of European Subordinated FIG

Rank Lead Manager Amount €m No of issues Share %
  • Last updated
  • 23 May 2017
1 HSBC 5,378.40 21 6.13%
2 Barclays 4,839.18 14 5.52%
3 Credit Suisse 3,558.82 15 4.06%
4 BNP Paribas 3,205.75 15 3.65%
5 Goldman Sachs 2,788.75 18 3.18%