Caruana defends Basel Committee on SMEs to European parliament

Basel Committee for Banking Supervision chairman Jaime Caruana strongly defended the group's proposals for credit risk weightings for loans to small and medium-sized enterprises (SMEs) to the audience at a EU parliament workshop on the subject yesterday in Brussels.

Caruana, who is also governor of the Bank of Spain, was the last speaker on the day’s agenda, which focused heavily on how changes imposed under Basel II’s advanced internal ratings-based approach would result in substantially increased charges for certain types of loans to SMEs, as well as equity investments by banks in those types of firms, according to certain political factions within the EU.

Caruana opened his remarks in a conciliatory way, noting that: “The workshop today reminds us