Too many questions in Basel floor plans, industry claims
While standardised rules are being revised, banks say they can't make a call on floors
Big unknowns in design and methodology are making it difficult to respond to regulators' plans for a system of capital floors, industry participants claim.
The idea behind the plans is to set minimum capital requirements for banks that model their exposure, with the floor set as a percentage of the relevant standardised approach, which is essentially a regulator-set formula. In its initial consultation paper, the Basel Committee on Banking Supervision did not say where the floors would be set
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