Asean Risk 2013: Use of credit ratings in Basel III provides risk weighting that ‘defies logic’
Economic fundamentals, not credit ratings, should drive Basel III risk weightings, argues CIMB markets head
Basel III's use of credit ratings fails to take account of the risks faced by highly leveraged European banks and results in a risk weighting for some Asian firms that does not reflect fundamentals. The skewed risk weighting unfairly punishes south-east Asian banks that have low levels of leverage and wholesale funding, according to Dato' Lee Kok Kwan, deputy chief executive and head of corporate banking, treasury and markets, at CIMB Group.
Speaking at the Asean Risk 2013 conference in Jakarta
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